Revenues at most small businesses are gradually recovering from the recession, but businesses in the construction and real estate sectors continue to lag behind, according to new data from Intuit Inc., which provides finance-management tools to small and medium-sized businesses.
The chart above shows revenue growth over time among 200,000 small-business users of Intuit’s Quickbooks Online. Revenues at small businesses that provide professional, scientific and technical services have performed the best. In that category, which includes everything from lawyers, Web designers, architects and consultants, revenue has grown by 68 percent from January 2005 to March 2012. Meanwhile, businesses in the construction, rental and real estate sectors saw their revenues crash in 2009 and are still at below-2005 levels, with real estate at about 87 percent of 2005 levels and construction at 91 percent.
“The framers and the movers, they’re still having a hard time of it,” said Susan Woodward, the economist who worked with Intuit to create the index. “Anyone who has anything to do with real estate is still in the doldrums.”
Health-care small businesses, the second-best performing category, have grown steadily in revenues since 2005 but appears to be slowing down. Woodward attributes this to both tightened discretionary spending among consumers and increased cost control by insurance companies.
“Health care seemed immune to recessions but now seems to be going down,” Woodward said. “As insurance companies become more clever about how to control payments, it’s small providers who are squeezed, like doctors and dentists.”