June 11 2010 - A mere 21 per cent of small business owners employing the fewest staff (between two and 10) are earning more than they hoped for when starting their companies - despite working an average of 58 hours per week. This finding comes from an online survey of small business owners conducted by IPSOS Public Affairs on behalf of hourly job website SnagAJob.com.
However, almost two-thirds (63 per cent) of owners employing up to 100 people said that starting their own business has been more satisfying than anticipated. This rose to 71 per cent among those planning to recruit within the next 12 months.
The survey included 511 small business owners of whom 255 had between two and 10 employees and 256 between 11 and 100. The great majority (91 per cent) cited 'being their own boss' as one of their top three reasons for starting a business, with 44 per cent saying it was the most important motivation. Nearly three-quarters (72 per cent) cited 'achieving a higher income' among their top three reasons. The frustrations associated with small business ownership included:
- bookkeeping (cited by 38 per cent)
- HR issues (31 per cent), and
- recruiting (18 per cent)
The survey found that 61 per cent of respondents intended to recruit in the next year to increase headcount (35 per cent) or because of turnover (26 per cent). When recruiting, 58 per cent said that 'identifying qualified applicants' was their biggest challenge. They were most likely to use free methods, the best results coming from:
- referrals (60 per cent)
- newspaper classified advertisements (13 per cent)
- walk-in enquiries (8 per cent)
- online job boards (8 per cent)
Other significant findings included:
Among small business owners that had grown their companies to employ 11 to 100 workers, 40 per cent said that it had been more financially rewarding than anticipated (compared to 21 per cent with two to 10 employees). However, they spent an average of 69 hours a week working towards their business (compared to 58 hours a week at smaller firms).
On average, small business owners spent 63 hours a week working (including time spent at the business, time at other locations and an average of 16 hours 'multi-tasking' when at least some attention was being given to the business).
Small business owners may under-estimate the difficulty of the enterprise. On a scale of 1 to 10, ranging from 'not at all difficult' to 'more difficult than imagined' the average response rated the difficulty as 6.6. Four out of ten (39 per cent) rated it an 8 or higher compared to just 13 per cent who rated the difficulty as 3 or less.
Shawn Boyer, CEO of SnagAJob.com said:
"Small businesses - much like the hourly workers we serve - are the backbone of America's economy. Small businesses employ just over half of private-sector employees, and more than half of the U.S. workforce is employed by the hour. Therefore, we're in a unique position to help match these large segments of the workforce. "