Gallup Survey: Government Regulations Hinder Small Business Hiring

Dennis Jacobe, Chief Economist, writes for Gallup:

 “…lawmakers could place a moratorium on new regulations for some period of time. In turn, this might provide the extra push needed to get small-business owners to decide to hire the employees they actually need and get the economy growing at a pace the average American can recognize as an economic recovery.”

Jacobe writes this in response to the most recent quarterly Wells Fargo/Gallup Small Business survey. Although small business hiring conditions are the best they have been since 2008, they are still not exceptionally good with 22 percent saying they expect to hire more people and 8 percent saying they plan to reduce the number of jobs at their company. Moreover 66 percent say they are worried about the US economy and one in four fear they may not be in business one year from now.

85 percent of small business owners say they are not hiring; among these, the top reasons for not doing so include not needing additional employees, concerns about cash flows and the US economy. About half of this group listed potential health care costs and new government regulations as reasons for not hiring.

These results have several implications for government action. Some may look at these numbers and conclude government should spend additional money, or “stimulus” funds, to create cash flows and work projects for these companies to encourage them to hire. Others will look at this data and conclude government cannot artificially bolster sustained demand for these companies but instead should look to repeal excessive regulation and stop enacting new regulations.

Wells Fargo/Gallup Small Business Survey



Gallup’s Methodology

Results for the total dataset are based on telephone interviews with 600 small-business owners, conducted Jan. 9-13, 2012. For results based on the total sample of small-business owners, one can say with 95% confidence that the maximum margin of sampling error is ±4 percentage points.

Sampling is done on an RDD basis using Dun & Bradstreet sampling of small businesses having $20 million or less of sales or revenues. The data are weighted to be representative of U.S. small businesses within this size range nationwide.

In addition to sampling error, question wording and practical difficulties in conducting surveys can introduce error or bias into the findings of public opinion polls.

For more details on Gallup's polling methodology, visit www.gallup.com.

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  • ||

    Its not the fear of new regulations that's killing new businesses in the cradle. Its the wall of regulations, from all levels, that already exists.

    I wonder if anyone has ever done an analysis of the deadweight cost in regulatory compliance that a new business would have to pay in order to open its doors and hire, say, 5 employees. I can tell you, from personal experience, that it is more than enough to prevent many, many people from starting their own business.

  • JEP||

    When the first CBO estimates came out for Obamacare, I actually took the time to read through most of one. One section required small businesses to provide health insurance to part time employees. The first thought that came to my mind was "oh, so now small businesses will only hire full time employees, since part time employees are so costly."

    If Obama wants people to go back to work, he should remove the regulations that prevent businesses that need something done from connecting to people who need a job.

    I should be able to go to a business and say "No, you don't need to provide me healthcare"

  • ||

    lawmakers could place a moratorium on new regulations

    I'm sure they're all kicking themselves for not thinking of this.

  • shrike||

    "job killin' regurlashions" is a right wing Limpdick redneck lie.

    Despite the EPA the USA has more drilling rigs in operation than the rest of the world combined.

  • Ice Nine||

    Could be. Perhaps you would discuss something relevant, like the many that are not in operation because of the onerous regulations.

  • shrike||

    Sorry. I'd like to be more topical, but I'm still waiting on the administration's talking points on this one.

  • The Pointer-Outer||

    You have semen dripping from your chin.

  • Barack the Jaunty Future King||

    That's Mine.

  • OSHA||

    Normally, we would be concerned over safety guidelines, but damned if we can find anything about fellating the President.

    To the meeting room, gentlemen! We must ponder this!

  • ||

    drilling rigs = small business?

    Hey chuckles, you're making Emily's point. Only well funded businesses have the resources to jump over the regulatory wall.

  • Sevo||

    shrike|2.22.12 @ 10:31AM|#
    ""job killin' regurlashions" is a right wing Limpdick redneck lie."

    So nearly 50% of small business owners are right wing rednecks?
    Or is shriek an ignoramus?

  • fish||

    Or is shriek an ignoramus?

    To ask the question is to answer it....

  • Spartacus||

    This week's Economist has some interesting articles on regulation in America.

    When a bunch of Euroweenies tell you you have too many regulations, then you know you are truly in trouble.

  • Fluffy||

    I think a big part of the 2012 problem is that the type of regulations being written now are "business closing" regulations, while the regulations of a generation ago were merely "cost imposing" regulations.

    "Pay this fee and open your thrift store" will discourage a certain number of people and result in a small number of jobs lost on the margin. "Sell any children's toy that has not been sent for lead paint testing and go to jail" shuts down entire business categories.

  • Fluffy||

    The modern regulatory state unmakes product lines and categories of businesses when it passes gas or burps in its sleep. That's a much different environment for starting a business than one where the state merely wants its $500 filing fee.

    Unless you're starting a software business or a restaurant, you can't be sure that whatever you think of today won't be shut down tomorrow. (And they're going to start in on software any moment now.)

    I'm very happy (for example) that I don't have any capital invested in a scrap metal business today.

  • ||

    Excessive regulations just force more start-ups into the underground/black-market economy. Why pay up for the initial overhead when you aren't certain your business plan will even work?

    One of my hobbies - high-end audio - had a number of sellers of "homemade / DIY" gear with no manuals, support lines, UL certification, no OSHA, ROHS, etc etc. And yet they churn out any number of units a year - some to fairly popular (well, popular in an underground sort of way) acclaim.

  • Fluffy||

    I had to split the above message in two due to Reason's job-killing new character limit on posts.

  • Fluffy||

    900 characters?

    NINE HUNDRED?

    My 5 year old's email signature has more than 900 characters.

  • ||

    That's 6.42 Tweets.

  • ||

    "job killin' regurlashions" is a right wing Limpdick redneck lie.

    Absolutely. Why wouldn't I want to wade through a hundred pages of regulations about what to do with my trash and waste cleaning products?

    Why wouldn't I want to be at the mercy of any jailhouse lawyer who wants to file a complaint with the state about how many bathroom breaks he gets? Why wouldn't I want an inspector to come to my place of business and check to see if the pitch of the stairs (or the number and spacing of balusters in the railing) to the storage area comply with some code I'm completely unaware of?

  • The Pointer-Outer||

    Ignorance of the law is unavoidable these days.

    Do you have a dead-cat-swinging permit?

  • Cat-Swinging Permit Supervisor||

    You'll need to fill out this stack of forms first.

    *thoomp*

    I'll get you a box of #2 pencils.

  • Slim||

    1817-1821: U. S. Federal Debt reduced 29%. Depression began 1819.
    1823-1836: U. S. Federal Debt reduced 99%. Depression began 1837.
    1852-1857: U. S. Federal Debt reduced 59%. Depression began 1857.
    1867-1873: U. S. Federal Debt reduced 27%. Depression began 1873.
    1880-1893: U. S. Federal Debt reduced 57%. Depression began 1893.
    1920-1930: U. S. Federal Debt reduced 36%. Depression began 1929.

    Always too little, always too late.

  • Spartacus||

    So, down periods follow up periods?
    I'll be damned.

  • Tony||

    Oh is that what that poll says? Are we titling pieces whatever we want, regardless of content these days?

  • Mr. FIFY||

    You say whatever you want, Tony... usually when you accuse people of racism, sexism, or wanting to feed old people to starving children.

    And you're on the same Team that gave us hate-speech laws. Go figure.

  • shrike||

    Spoken like a true redneck Christ-fag.

  • The Pointer-Outer||

    Both sides do that, but the left has a particularly hypocritical streak when it comes to demonizing their right-wing opponents.

    Then again... water is wet.

  • Mr. FIFY||

    You may not have been around when he admitted to being bigoted against straight people... then he turns around and demands others treat people with respect.

    The man is just plain screwed up in the noggin. But then, he's a Team player.

  • Tony||

    I have all sorts of prejudices and, indeed, a few other imperfections. I don't like straight people for the most part, or fat people, or religious people. But I was taught manners as a child and certainly don't want the law to oppress anyone.

    What you and people like you would have us believe is that you have no prejudices whatsoever, which is simply a laughable claim, but not so mendacious as the inevitable claim that comes with your protestations: that white christian heterosexual males are the biggest victims of prejudice in society.

  • Sevo||

    Yes, shithead, there isn't anyone who posts there that hasn't figured out you're a self-righteous, egotistical twit.
    We got it.

  • fish||

    That's some first class spoof!

  • The Pointer-Outer||

    I'm having difficulty telling spoof from non-spoof. Still kind of new here, you know.

  • ||

    More often than not, when I see some outlandish deranged assertion under the name "Tony" and think, "Huh- Obvious Spoof is Obvious" he will spend an hour or more elaborating on it.

    You just never can tell.

  • X||

    Hire someone? With Obamacare looming and a tripling of regulation in my business over the last 3 years? Leave your resume. I'll take a look at it when I finish this pointless uncompensated dead loss paperwork that is never finished.

  • Mr Whipple||

    I am reluctant to hire any workers back. Why? Because I laid off employees, when I hire them back I will be forced to pay higher unemployment insurance premiums. UI premiums in most states are Experience Rated.

  • @AgoristDon||

    Can you name 12 things you do that aren't regulated by government in some way? I didn't think so.

    Uncle Sam's Clogged Arteries - A "We're Over-Regulated" Rant

    http://tirelessagorist.blogspo.....eries.html

  • erikjay||

    "85 percent of small business owners..."

    AP style (which I thought you used) has numbers spelled out when beginning a sentence. Most style guides agree. Just pointing it out. Again.

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