Nearly Half of Small Businesses in State Say It’s ‘Unfriendly’
By RAJIV VYAS
Nearly half of California’s small businesses believe the state is an unfriendly environment for them, but two-thirds expect to increase revenue and earnings this year.
These numbers are contained in a survey of about 1,800 small business owners statewide by Union Bank of California.
In Orange County, 39% of business owners surveyed believe that California has an unfriendly business environment,slightly less than the 43% of owners statewide who hold that view,with 42% in OC believing the state is friendly and 20% having no opinion.
“The jury is out on the state’s business friendliness,” said Keitaro Matsuda, senior vice president of economic research at Union Bank. “The fact that 43% of the respondents thought that California is ‘business unfriendly’ raises a red flag. After all, small businesses account for roughly half of all employment in the state.”
Higher workers’ compensations insurance costs, stringent environmental regulations, a high cost of living and assorted bureaucratic hurdles could be responsible for the high percentage of “unfriendly” responses, said Matsuda.
The survey also asked questions on the outlook of small businesses for 2002. Just as the year kicks in, 72% of Orange County small businesses surveyed believed their 2002 profits will be better than 2001’s, with 24% estimating similar profits and only 4% predicting worsening profits.
Statewide, 66% of respondents are expecting a better year than 2001, with only 8% feeling this could be a worse year for business than 2001.
Meanwhile, 49% of respondents indicated they gained in both revenue and earnings in the fourth quarter in 2001, compared with the fourth quarter of 2000.
Union Bank of California surveyed 214 small business owners in Orange County and about 1,800 statewide in February for this survey. The researchers defined small businesses as companies with annual sales of less than $5 million for fiscal year 2001.
