Inflation is hurting the ability of small businesses to hire and retain workers. As such, companies are being forced to raise consumer prices. Overall, inflationary pressures on companies have worsened since January.
Small business owners say inflation continues to get worse as energy prices rise
These were the findings of a new Goldman Sachs 10,000 Small Businesses Voices survey, an initiative designed to help U.S. small business owners advocate for policy changes that help their businesses, employees, and communities.
The survey involved responses from 1,107 Goldman Sachs 10,000 Small Business participants and was conducted by Babson College and David Binder Research from April 11-14, 2022.
Inflationary pressure on small businesses has worsened
The survey found that 88% of small business respondents say inflationary pressure on their business has worsened since January this year.
Rising energy costs are also affecting small businesses, with 73% of respondents in all sectors saying the rise in gas and electricity bills is having an impact on their business.
A large majority (91%) of small business owners say that broader economic trends, such as inflation, supply chain problems, and labor force challenges, are having a negative impact on their business. .
70% of respondents said they are concerned about employees leaving their businesses, because larger companies can offer a higher salary and more generous profits.
The survey provides valuable information to small businesses about the challenges small business owners in different industries face. Showing the main grievances and concerns that small businesses can help people who run businesses in the US know that they are not alone.
Take steps to protect small businesses
They can also use the results of the survey to take the necessary steps to help protect their business. One step could be to implement a positive and supportive work culture to prevent employees from moving to larger companies, which is a key concern among many small business owners.
Khari Parker, a member of Goldman Sachs 10,000 Small Businesses Voices National Leadership Council and owner of Connie’s Chicken and Waffles in Baltimore, described the challenges small businesses currently face: “Small business owners are stuck in a rock and roll. a hard place like inflation and an uneven economic recovery is affecting every part of our business with no end in sight.
“Small business owners need policymakers to understand that while most businesses have reopened completely since the pandemic, the road to a full recovery will be long, with new challenges on every corner.”
Level the playing field for small businesses
According to the Goldman Sachs survey, small businesses are asking the federal government to promote competitiveness by creating programs and services that better reflect the needs of today’s small businesses.
88% of small business owners say small businesses are struggling compared to larger businesses in their local communities.
86% believe the federal government should do more to level the playing field so that small businesses are better equipped to compete with larger companies. While 93% of respondents to the study believe that the federal government should do more to tailor programs and services to better reflect the realities and needs of small businesses.