Release Date: 09/ 01/ 2005
CONTACT: Bill Vernon, (617) 482-1327 or Jim Jennings, (240) 645-4099
Many See Immigrant Labor as Economic Plus
BOSTON, Mass. -- Massachusetts’ overall business climate continues to be fairly strong, according to the Massachusetts Small-Business ConditionsSM. The report’s data, which was released today by the National Federation of Independent Business/Massachusetts, provides an overview of small-business conditions within Massachusetts and compares them with neighboring states.
“Massachusetts’ small employers continue to be satisfied with the current business conditions and are optimistic that the economy will continue to move along over the next several months,” said Bill Vernon, NFIB/Massachusetts state director.
A net 41 percent of the state’s small employers believed business conditions in their market area are “good.” That compares to Connecticut and New York where only a net 29 percent see their business conditions as “good.” Massachusetts’ business owners also see conditions as “improving” or “stable.” A net 62 percent characterized the outlook for business over the next three months as “better,” citing sales prospects and increased productivity as the primary reasons for their view. Owners in Connecticut and New York had a similar outlook.
Of those surveyed in Massachusetts, a net 32 percent indicated that profits were “good” and a net 48 percent of those same respondents characterized sales as “good,” both increased from the second quarter. However, a net 55 percent of small employers reported that over the last three months their purchasing prices rose, while only a net 14 percent reported they had increased selling prices.
One-third of the small-business owners surveyed say that immigrant labor provides skills not otherwise available and fills jobs that otherwise would not be filled. “The importance of immigrant labor to the success of small business came through loud and clear,” Vernon said. “Many small-business owners in Massachusetts – in the hospitality industry, landscaping, fishing, and other significant economic sectors – rely on immigrant workers to fill jobs and provide skills. Only 5 percent say that immigrants crowd out American workers.”
Small-business hiring has been slow but steady with a net 23 percent noting they had “one or more” current job openings. Over the same three-month period, 41 percent of small-business owners made capital expenditures. While 41 percent of the respondents reported spending on technology upgrades, the number of owners making expenditures for employee training was 38 percent.
When asked to rank their most important business problem, Massachusetts small-business owners ranked insurance, including health care costs, as the most serious of all conditions. Employee quality and costs, as well as rising prices, were also prominently mentioned as serious problems.
Vernon noted that the Commonwealth’s small-business owners most value the state’s quality of life and remain principally because their roots are here. But the state’s economic opportunity and economic vibrancy and vitality rank much lower on small business owners’ list of the state’s attributes. Only a net 11 percent said they felt the state was “supportive” of small business. “These factors can be improved by changes in public policy,” Vernon said.
The Small Business ConditionsSM reports are developed from surveys of small-business owners in selected states. The surveys are designed to determine the condition of the small-business economy in each particular state. The surveys are conducted every three months and results are released on the first day of the month following completion. The text of the questions and the complete response set to the survey can be found at www.NFIB.com/research.
| Massachusetts Small-Business ConditionsSM | ||||||
| This chart shows the results from Massachusetts and its comparative standing among selected nearby states. | ||||||
| Mass. | Conn. | N.Y. | ||||
| Business Climate | Survey Date | |||||
| Overall state business environment | ||||||
| Net % supportive of small business | 8/2005 | 11 | 6 | 12 | ||
| Prior qtr. | 15 | 7 | 0 | |||
| Business conditions in market area | ||||||
| Net % "good" | 8/2005 | 41 | 29 | 29 | ||
| Prior qtr. | 33 | 39 | 22 | |||
| Net % "improving" | 8/2005 | 6 | 7 | 9 | ||
| Prior qtr. | 12 | 8 | 0 | |||
| Outlook for business | ||||||
| Net % "good" in next three months | 8/2005 | 62 | 57 | 53 | ||
| Prior qtr. | 60 | 60 | 47 | |||
| Reason for optimism | ||||||
| % Sales prospects | 8/2005 | 45 | 47 | 47 | ||
| Prior qtr. | 41 | 47 | 48 | |||
| % Lower costs | 8/2005 | 3 | 4 | 3 | ||
| Prior qtr. | 6 | 2 | 4 | |||
| % Price increases | 8/2005 | 3 | 6 | 7 | ||
| Prior qtr. | 4 | 7 | 3 | |||
| % Greater productivity | 8/2005 | 14 | 10 | 13 | ||
| Prior qtr. | 10 | 19 | 13 | |||
| % Government policy | 8/2005 | 2 | 4 | 5 | ||
| Prior qtr. | 2 | 4 | 4 | |||
| % Seasonal/Weather | 8/2005 | 12 | 5 | 7 | ||
| Prior qtr. | - | - | - | |||
| Reason for pessimism | ||||||
| % Sales prospects | 8/2005 | IC* | IC | IC | ||
| Prior qtr. | IC | IC | IC | |||
| % Cost increases | 8/2005 | IC | IC | IC | ||
| Prior qtr. | IC | IC | IC | |||
| % Pressure on selling prices | 8/2005 | IC | IC | IC | ||
| Prior qtr. | IC | IC | IC | |||
| % Lower productivity | 8/2005 | IC | IC | IC | ||
| Prior qtr. | IC | IC | IC | |||
| % Government policy | 8/2005 | IC | IC | IC | ||
| Prior qtr. | IC | IC | IC | |||
| Mass. | Conn. | N.Y. | ||||
| Sales and earnings (last quarter) | ||||||
| Sales | ||||||
| Net % sales "good" | 8/2005 | 48 | 38 | 42 | ||
| Prior qtr. | 39 | 47 | 31 | |||
| Profits | ||||||
| Net % profits "good" | 8/2005 | 32 | 13 | 26 | ||
| Prior qtr. | 26 | 29 | 10 | |||
| Employment | ||||||
| Current job openings (one or more) | ||||||
| % "Yes" | 8/2005 | 23 | 22 | 23 | ||
| Prior qtr. | 17 | 16 | 21 | |||
| Per employee payroll cost | ||||||
| Net % "risen" | 8/2005 | 16 | 15 | 19 | ||
| Prior qtr. | 15 | 15 | 16 | |||
| Employee cost pressures (greater) | ||||||
| % Wages | 8/2005 | 47 | 47 | 48 | ||
| Prior qtr. | 51 | 46 | 45 | |||
| % Benefits | 8/2005 | 35 | 35 | 29 | ||
| Prior qtr. | 23 | 28 | 31 | |||
| Mass. | Conn. | N.Y. | ||||
| Productivity | ||||||
| Upgraded technology/processes (last three months) | ||||||
| % "Yes" | 8/2005 | 41 | 41 | 46 | ||
| Prior qtr. | 42 | 41 | 41 | |||
| Made capital expenditure(s) (last three months) | ||||||
| % "Yes" | 8/2005 | 41 | 41 | 46 | ||
| Prior qtr. | 41 | 39 | 40 | |||
| Made expenditure to train employee(s) (last three months) | ||||||
| % "Yes" | 8/2005 | 38 | 43 | 43 | ||
| Prior qtr. | 35 | 34 | 35 | |||
| Capacity utilization - can increase sales 10% without new inputs | ||||||
| % "Yes" | 8/2005 | 52 | 58 | 55 | ||
| Prior qtr. | 51 | 47 | 45 | |||
| Credit availability (last three months) | ||||||
| % All credit needs satisfied | 8/2005 | 40 | 31 | 32 | ||
| Prior qtr. | 36 | 46 | 35 | |||
| % All credit needs not satisfied | 8/2005 | 5 | 10 | 10 | ||
| Prior qtr. | 7 | 3 | 6 | |||
| % No credit needs | 8/2005 | 49 | 53 | 54 | ||
| Prior qtr. | 51 | 45 | 50 | |||
| Mass. | Conn. | N.Y. | ||||
| Prices | ||||||
| Purchasing prices (last three months) | ||||||
| Net % increased | 8/2005 | 55 | 58 | 55 | ||
| Prior qtr. | 50 | 52 | 54 | |||
| Selling prices (last three months) | ||||||
| Net % increased | 8/2005 | 14 | 14 | 18 | ||
| Prior qtr. | 18 | 15 | 14 | |||
| Miscellaneous | ||||||
| Involvement in start of another business | ||||||
| % "Yes" | 8/2005 | 10 | 10 | 11 | ||
| Prior qtr. | 9 | 10 | 11 | |||
| Single most important business problem | ||||||
| % Weak sales | 8/2005 | 9 | 9 | 11 | ||
| Prior qtr. | 13 | 14 | 11 | |||
| % Taxes | 8/2005 | 8 | 16 | 15 | ||
| Prior qtr. | 10 | 12 | 11 | |||
| % Employee quality/costs | 8/2005 | 11 | 7 | 7 | ||
| Prior qtr. | 9 | 9 | 8 | |||
| % Insurance | 8/2005 | 19 | 17 | 15 | ||
| Prior qtr. | 17 | 19 | 16 | |||
| % Big-business competition | 8/2005 | 13 | 14 | 13 | ||
| Prior qtr. | 14 | 11 | 14 | |||
| % Inflation/Rising prices | 8/2005 | 15 | 12 | 10 | ||
| Prior qtr. | 11 | 12 | 10 | |||
| % Credit availability/Interest rates | 8/2005 | 4 | 3 | 3 | ||
| Prior qtr. | 3 | 3 | 1 | |||
| % Regulations/Red tape | 8/2005 | 6 | 8 | 8 | ||
| Prior qtr. | 7 | 7 | 7 | |||
| Massachusetts Quarterly Spotlight | |
| What do you value most in the area you do business? | |
| Quality of life | 32% |
| Physical environment | 7% |
| Opportunity | 16% |
| Vibrance and vitality | 3% |
| My roots are here | 33% |
| Other | 3% |
| Don't know/Refused | 7% |
| Total | 100% |
| Which best describes the role immigrant labor plays in your area? | |
| Provides skills not otherwise available | 10% |
| Fills jobs that wouldn't otherwise be filled | 21% |
| Crowds out American workers | 5% |
| No appreciable role | 37% |
| Don't know/Refused | 27% |
| Total | 100% |
The Poll
NFIB’s Massachusetts Small-Business ConditionsSM is a telephone survey of a random sample of Massachusetts small employers regarding business conditions within the state. “Small employer” is defined here as employing between one and 250 people (not including the owner(s)) in a for-profit business. Each edition of the survey has a minimum of 350 respondents. The sampling error is ± 5 percentage points. Data are collected quarterly in the months of February, May, August and November, beginning in February 2005. The MRCGroup of Las Vegas conducts the survey for the NFIB Research Foundation.
The Sponsor
The NFIB Research Foundation is a 501 (c)(3) organization that provides policy-makers, media, educators, small-business owners and other interested parties empirically based information on small business and small-business owners. The Foundation is affiliated with the National Federation of Independent Business, the nation’s largest small- and independent-business advocacy organization, and is located in Washington, D.C.
