Release Date: 03/ 01/ 2005
CONTACT: Mark Alesse, (518) 434-1262 or Jim Jennings, (240) 645-4099
New York at bottom compared with neighboring states. Only net 3 percent of small employers say the business climate is "supportive."
NEW YORK -- With union demands for unaffordable growth in spending and economically destructive new taxes as backdrop, New York's business climate has fallen to the worst in the Northeast, according to a new report released today by the National Federation of Independent Business – the New York Small-Business ConditionsSM. The report provides an important overview of small-business conditions within New York and compares them with neighboring states.
"Our economy can't get out of first gear because we have the highest overall costs of doing business in the nation. These hurt small businesses more than they do big businesses, but both are impacted negatively. Costs include income taxes and corporate taxes, health insurance, workers' comp insurance, liability insurance (if you can get it), property taxes, energy and wages. All are too high and make us uncompetitive," said Mark Alesse, NFIB/New York State Director.
Only a net 3 percent (percent supportive minus percent not supportive) of New York's small employers believed the statewide business climate was "supportive," as compared with Connecticut (14 percent), Massachusetts (13 percent) and Pennsylvania (23 percent).
Just a net 12 percent indicated that profits were "good" in New York, and a net 22 percent of those respondents characterized sales as "good," (both were the lowest in the region). Overall, 56 percent of small employers reported that in the last three months their purchasing prices rose, while only 16 percent reported that they had increased their prices. However, a majority (56 percent) said increased "sales prospects" led them to conclude the outlook over the next three months was good.
Small-business hiring has been slow, but 22 percent said they had one or more job openings. Over the same three-month period, 45 percent of New York's small-business owners made capital expenditures. Some 47 percent of the respondents reported spending on technology upgrades, and 42 percent were making expenditures for employee training.
When asked to pick their most important business problem, 16 percent of New York's small-business owners chose "insurance," followed by 15 percent who chose "taxes," while 14 percent identified "competition from big business."
For information about the Small-Business ConditionsSM project, and other small-business research studies conducted by the NFIB Research Foundation, visit www.NFIB.com/research.
| New York Small-Business ConditionsSM | ||||||
| This chart shows the results from New York and its comparative standing among selected nearby states. | ||||||
| N.Y. | Conn. | Mass. | N.J. | Pa. | ||
| Business Climate | Survey Date | |||||
| Overall state business environment | ||||||
| Net % supportive of small business | 2/2005 | 3 | 14 | 13 | 15 | 23 |
| Prior qtr. | - | - | - | - | - | |
| Business conditions in market area | ||||||
| Net % "good" | 2/2005 | 17 | 33 | 33 | 36 | 29 |
| Prior qtr. | - | - | - | - | - | |
| Net % "improving" | 2/2005 | 7 | 13 | 12 | 12 | 15 |
| Prior qtr. | - | - | - | - | - | |
| Outlook for business | ||||||
| Net % "good" in next three months | 2/2005 | 56 | 67 | 62 | 54 | 63 |
| Prior qtr. | - | - | - | - | - | |
| Reason for optimism | ||||||
| % Sales prospects | 2/2005 | 63 | 56 | 47 | 40 | 39 |
| Prior qtr. | - | - | - | - | - | |
| % Lower costs | 2/2005 | 2 | 2 | 4 | 7 | 2 |
| Prior qtr. | - | - | - | - | - | |
| % Price increases | 2/2005 | 4 | 3 | 3 | 1 | 3 |
| Prior qtr. | - | - | - | - | - | |
| % Greater productivity | 2/2005 | 10 | 11 | 16 | 18 | 18 |
| Prior qtr. | - | - | - | - | - | |
| % Government policy | 2/2005 | 2 | 3 | 3 | 5 | 4 |
| Prior qtr. | - | - | - | - | - | |
| Reason for pessimism | ||||||
| % Sales prospects | 2/2005 | 5 | 29 | 14 | 24 | 11 |
| Prior qtr. | - | - | - | - | - | |
| % Cost increases | 2/2005 | 11 | 29 | 21 | 8 | 5 |
| Prior qtr. | - | - | - | - | - | |
| % Pressure on selling prices | 2/2005 | 11 | 0 | 0 | 16 | 11 |
| Prior qtr. | - | - | - | - | - | |
| % Lower productivity | 2/2005 | 5 | 7 | 0 | 4 | 0 |
| Prior qtr. | - | - | - | - | - | |
| % Government policies | 2/2005 | 47 | 14 | 29 | 12 | 42 |
| Prior qtr. | - | - | - | - | - | |
| N.Y. | Conn. | Mass. | N.J. | Pa. | ||
| Sales and earnings (last quarter) | ||||||
| Sales | ||||||
| Net % sales "good" | 2/2005 | 25 | 40 | 35 | 29 | 36 |
| Prior qtr. | - | - | - | - | - | |
| Profits | ||||||
| Net % profits "good" | 2/2005 | 12 | 18 | 18 | 16 | 20 |
| Prior qtr. | - | - | - | - | - | |
| Employment | ||||||
| Current job openings (one or more) | ||||||
| % "Yes" | 2/2005 | 22 | 22 | 19 | 23 | 19 |
| Prior qtr. | - | - | - | - | - | |
| Per employee payroll cost | ||||||
| Net % "risen" | 2/2005 | 29 | 22 | 17 | 13 | 16 |
| Prior qtr. | - | - | - | - | - | |
| Employee cost pressures (greater) | ||||||
| % Wages | 2/2005 | 56 | 50 | 53 | 45 | 45 |
| Prior qtr. | - | - | - | - | - | |
| % Benefits | 2/2005 | 28 | 32 | 33 | 35 | 36 |
| Prior qtr. | - | - | - | - | - | |
| N.Y. | Conn. | Mass. | N.J. | Pa. | ||
| Productivity | ||||||
| Upgraded technology/processes (last three months) | ||||||
| % "Yes" | 2/2005 | 47 | 47 | 41 | 41 | 40 |
| Prior qtr. | - | - | - | - | - | |
| Made capital expenditure(s) (last three months) | ||||||
| % "Yes" | 2/2005 | 45 | 43 | 42 | 41 | 41 |
| Prior qtr. | - | - | - | - | - | |
| Made expenditure to train employee(s) (last three months) | ||||||
| % "Yes" | 2/2005 | 42 | 45 | 37 | 37 | 35 |
| Prior qtr. | - | - | - | - | - | |
| Capacity utilization - can increase sales 10% without new inputs | ||||||
| % "Yes" | 2/2005 | 54 | 63 | 61 | 53 | 57 |
| Prior qtr. | - | - | - | - | - | |
| Credit availability (last three months) | ||||||
| % All credit needs satisfied | 2/2005 | 34 | 41 | 35 | 39 | 37 |
| Prior qtr. | - | - | - | - | - | |
| % All credit needs not satisfied | 2/2005 | 12 | 8 | 9 | 7 | 6 |
| Prior qtr. | - | - | - | - | - | |
| % No credit needs | 2/2005 | 47 | 47 | 51 | 50 | 53 |
| Prior qtr. | - | - | - | - | - | |
| N.Y. | Conn. | Mass. | N.J. | Pa. | ||
| Prices | ||||||
| Purchasing prices (last three months) | ||||||
| Net % increased | 2/2005 | 56 | 60 | 48 | 47 | 51 |
| Prior qtr. | - | - | - | - | - | |
| Selling prices (last three months) | ||||||
| Net % increased | 2/2005 | 16 | 22 | 17 | 12 | 20 |
| Prior qtr. | - | - | - | - | - | |
| Miscellaneous | ||||||
| Involvement in start of another business | ||||||
| % "Yes" | 2/2005 | 17 | 13 | 11 | 12 | 9 |
| Prior qtr. | - | - | - | - | - | |
| Single most important business problem | ||||||
| % Weak sales | 2/2005 | 11 | 9 | 10 | 10 | 10 |
| Prior qtr. | - | - | - | - | - | |
| % Taxes | 2/2005 | 16 | 11 | 9 | 11 | 12 |
| Prior qtr. | - | - | - | - | - | |
| % Employee quality/costs | 2/2005 | 9 | 14 | 10 | 8 | 11 |
| Prior qtr. | - | - | - | - | - | |
| % Insurance | 2/2005 | 17 | 21 | 22 | 22 | 18 |
| Prior qtr. | - | - | - | - | - | |
| % Big-business competition | 2/2005 | 14 | 15 | 17 | 17 | 15 |
| Prior qtr. | - | - | - | - | - | |
| % Inflation/Rising prices | 2/2005 | 11 | 5 | 11 | 6 | 7 |
| Prior qtr. | - | - | - | - | - | |
| % Credit availability/Interest rates | 2/2005 | 5 | 2 | 2 | 4 | 3 |
| Prior qtr. | - | - | - | - | - | |
| % Regulations/Red tape | 2/2005 | 7 | 9 | 9 | 7 | 10 |
| Prior qtr. | - | - | - | - | - | |
| New York Quarterly Spotlight | |
| In general how satisfied are you with the direction New York is headed? | |
| Very satisfied | 8% |
| Somewhat satisfied | 33% |
| Not too satisfied | 32% |
| Not at all satisfied | 23% |
| Don't know/Refused | 4% |
| Total | 100% |
| Over the last year, which type of business insurance has had the most rapidly rising premiums? | |
| Vehicle collision and liability | 16% |
| Workers’ compensation | 11% |
| Product or professional liability | 17% |
| Property and casualty | 11% |
| Employee health | 29% |
| Don't know/Refused | 16% |
| Total | 100% |
The Poll
NFIB’s New York Small-Business ConditionsSM is a telephone survey of a random sample of New York 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.
