Economy has small companies optimistic
By Jim Hopkins
USA Today
SAN FRANCISCO — Small companies are in a hiring and spending mood again.
Behind the shift: high levels of optimism that the economy is emerging from recession, a new survey says.
Of the 553 small companies surveyed last month, 48 percent expect the economy to be better in six months. That is the highest percentage recorded since the National Federation of Independent Business trade group began monthly surveys in 1986.
Their optimism is important. The 5.6 million small employers in the United States create a majority of new jobs and account for about 25 percent of the $1.4 trillion in annual spending for personal computers, machinery and other capital purchases.
Amid the brighter outlook, companies are:
• Considering hiring. The Book Bouquet, a three-employee gift basket retailer in Albany, N.Y., could double its staff in the next year, owner Kim Shanahan says.
TR Box, Tapes Etc., an office-supply wholesaler, also may add employees if sales pick up, owner Peter Trusty says. The Los Angeles-area company, with $5 million in annual revenue, has six employees, down from nine a year ago.
• Buying equipment. The Consummate Consumer, a consumer advice company, will spend as much as $2,000 for a fax machine and two PCs at its office in Beaverton, Ore. Marti Schwartz, its owner and sole employee, was making do with older equipment until February, when the economy started "coming out of a fog," she says.
• More advertising. Atlanta marketing firm Communications 21 is promoting itself more because companies began spending again in late January, it says. The agency, with high-tech, real estate and food clients, expects about $650,000 in revenue this year.
Despite increased optimism, worries abound for small businesses.
"I don't know what happened to the recovery," says Dan Sanchez, owner of Sanchez & Associates, a Chicago advertising and public relations firm.
Sanchez says that Rust Belt manufacturers are in the doldrums, and Chicago-based Arthur Andersen recently announced 7,000 job cuts.
The Castle Group in Boston, a corporate event planner, wants to double its office space. But the 19-employee firm, which had $2.2 million in revenue last year, is being cautious.
"We don't want to take on more than we need," co-founder Sandy Lish says.
