Washington-area small business owners have the sunniest outlook of entrepreneurs in nine major U.S. cities, with large majorities here saying they plan to expand their operations and hire more personnel in the near future, a new survey done for Bank of America found.
Most local small business owners expect both the metropolitan and national economies will improve in the coming year, and their outlook has brightened considerably since 2014, according to the survey, which was released Tuesday. This increased optimism about the economy was true in all cities surveyed, the bank found.
There were some thunderheads drifting across the generally bright horizon. Small business owners both locally and nationally were considerably less optimistic about the global economy, expressing concerns about the prospect of financial crises in countries such as China and Greece. They also worried about possible increases in U.S. interest rates and the minimum wage, as well as the outcome of the 2016 presidential contest.
But the overall mood was decidedly upbeat, and nowhere more so than in the Washington area, where 81 percent of those surveyed said they planned to increase the size of their business over the next five years and 73 percent intended to take on more personnel in the next 12 months. On both questions, local responses were more optimistic than anywhere else surveyed.
“There’s major growth happening in the city,” said Ryan Coughlin, Bank of America’s small business market manager in Washington, in explaining the optimism. “More and more businesses are seeing people moving into the city and doing business.”
As they look to expand their staffs, local business owners are offering greater flexibility, with nearly half allowing employees to telecommute, up from 32 percent five years ago. Eleven percent say they provide onsite gyms or workout classes, 26 percent have nap pods or game rooms – and 13 percent allow their workers to bring their pets to work.
Nationally, the survey found a significant generation gap, with younger business owners more optimistic than older ones. For example, 74 percent of millennials – defined as those age 18 to 34 – expect their local economy to improve in the next year, while just 44 percent of baby boomer business owners – those age 50 to 68 – share that view.
Coughlin said the generational split is present locally as well, and he sees a connection between the youthful optimism and the increased perks offered.
“You walk into an office, there’s ping pong tables, there’s game rooms, there’s nap rooms,” he said. “The work-life balance is there, and they’re optimistic because they have that balance.”
And why are boomers sourer? “Because they’re more experienced,” Coughlin surmised. “If you’ve been though it and seen bad things happen, it’s harder to be optimistic.”
The survey was conducted for Bank of America by Braun Research Inc. from Aug. 21 to Sept. 22. A total of 1,001 business owners whose firms had revenue of less than $5 million and fewer than 100 employees were surveyed. The margin of error is plus or minus 3.1 percent. For the sample of 300 Washington-area business owners, it was 5.7 percent. The other cities surveyed were New York, Los Angeles, Chicago, Dallas, Atlanta, Miami, San Francisco and Boston.