Last Oct. 2015 the Unemployment rate for the state of Ohio was a 4.7%, and since then it has been increasing slowly, but surely to a 5.1% as of last month. A small increase to be sure, but it does make you wonder whether there are better times to come for the state, or things are going to progressively get worse. Small businesses in Ohio are not as optimistic as they were last year, and some are still wondering wether the minimum wage increase will have other ramifications for their businesses. For more news bout Ohio, follow the links below.
The State of Small Business: Ohio
As part of our yearlong project “The State of Small Business,” Business News Daily plans to report on the small business environment in every state in America. In this installment, we asked a few of Ohio’s roughly 1 million small business owners about the challenges and opportunities of operating in their state. Here’s what they had to say.
Ohio’s economy has had its ups and downs over the years, experiencing decline long before the rest of the nation felt the effects of the financial crisis. In the years preceding the recession, Ohio’s manufacturing sector was hollowed out, contributing to a drop in per capita income and a drastic slowdown in growth. And while the unemployment rate has plummeted, the labor force has shed nearly 300,000 workers since its peak in late 2007, according to the U.S. Bureau of Labor Statistics. And as employment rises, so does the demand for skilled or experienced labor, and business owners find it progressively harder to hire the employees they need at the cost they want.
However, in 2008 — amid the recession — Ohio’s per capita income started to gain compared to the national average, and the U.S.’ seventh-largest economy has seen some bright spots. Despite a difficult decade — between 2004 and 2014, the compound annual growth rate of Ohio’s GDP was an anemic 0.3 percent, according to the U.S. Bureau of Economic Analysis (BEA) — entrepreneurs in Ohio are seeing promise again. For small business owners in the Buckeye State, the sentiment is tepid optimism that a fledgling startup community and the return of manufacturing in the form of tech-focused companies will propel the economy forward in the years to come.
While small business owners acknowledge that there are some downsides to increasing wages for their entry-level workers, many of these business owners also find positives in doing so, new research finds.
Nearly 60 percent of small business owners said they favor raising the minimum wage, and the same percentage said they would likely vote for a state or national candidate who supports a minimum-wage increase, according to a study from Manta, a provider of products, services and educational resources for small businesses.
The results were released as both California and New York recently approved measures to gradually increase their minimum wages to $15 per hour.
The majority of small businesses surveyed are already paying their employees above what’s required. The research revealed that 40 percent of small business owners pay entry-level employees “far above” the required minimum wages in their areas of operation, while 38 percent pay “slightly above” the minimum wage. Just 14 percent are paying the state or local minimums, and only 9 percent are paying the federal minimum wage of $7.25 per hour.
Small Business Confidence Hits New Two-Year Low
Small business confidence fell to a fresh two-year low in March amid persistent worries about sales and profits, the latest indication that economic growth braked sharply in the first quarter.
The National Federation of Independent Business (NFIB) said on Tuesday its small business optimism index dipped 0.3 point to a reading of 92.6 last month, the lowest since February 2014.
It has declined from a reading of 100 in December 2014 and has pushed further off its 42-year average of 98.
“A ‘chartist’ looking at the data historically might conclude that the index has clearly hit a top and is flashing a recession signal. The April survey will decide whether or not the alarm should be rung,” the NFIB said in statement.
The soft reading fits in with recent economic data on consumer and business spending as well as wholesale inventory investment that have suggested economic growth slowed sharply from the fourth quarter’s 1.4 percent annualized rate.
