SMB JOB GENERATION

OUTLOOK

Q3 2014

HIRING OR DOWNSIZING IN NEXT QUARTER

The percent of SMBs who plan to hire in the coming months is up 6 points from this same

time last year.

ECONOMIC PROSPECTS FOR YOUR COMPANY

HIRE ADDITIONALEMPLOYEES

NO CHANGE IN WORKFORCE

OR DON’T KNOW

DOWNSIZE WORKFORCE

COMPANY POSITIONA majority of SMB executives report their

companies to be in a healthy condition of either stability or growth.

3% 8%

41%48%

SurvivalControlled RetrenchmentGrowthMaintainingStability

#1 BUSINESS ISSUE FACING SMBSHealth care costs continue to be of chief concern to SMBs, though talent availability challenges have steadily increased, narrowing the gap to 3 points. Rank:

44% 45% 11%

SMBs generally continue to be optimistic about the economic prospects for their own companies.

1%Very pessimistic

10%Somewhat pessimistic

21%Neither optimistic nor pessimistic

46%Somewhat optimistic

22%Very optimistic

9%Uncertainty in tax policy

6%Environmental regulations

29%Talent availability

21%Domestic and international costs

32%Health care costs

3%Other HIRING DIFFICULTY

SMB leaders report ongoing and increasing challenges in finding qualified talent for open professional positions.

11%EXTREMELY

DIFFICULT

50%DIFFICULT

7%EASY

32%NEITHER EASY OR DIFFICULT

IMPACT OF PATIENT PROTECTIONAND AFFORDABLE CARE ACT

The majority of SMBs report that they expect full ACA implementation to project some level of impact onto their businesses.

Close to half of respondents say their companies have prepared and are ready for ACA implementation, the highest percentage ever recorded by the SMB Outlook.

15% NO IMPACT

18% A LITTLE IMPACT

41% SOME IMPACT

26% A LARGE IMPACT

45% A LOT OF PREPARATION, AND WE’RE READY

38% WE’RE WORKING ON IT, BUT WE’RE NOT READY YET

5% WE HAVE NOT DONE ANYTHING TO PREPARE, BUT WE PLAN TO

15% WE WILL NOT DO ANYTHING TO PREPARE

MINIMUM WAGE

SMBs shared how a $10.10 minimum wage increase could affect their businesses. (Multiple responses allowed)

Asked to identify an ideal minimum wage via sliding scale, SMBs expressed varied levels of acceptance toward an increase.

We will increase prices to our end customers ..........................21%We will reduce our new hiring plans .....................................17%We will reduce our current workforce ...........................15%We will eliminate all new hiring ...... 6%We will not stay in business .............1%Increasing the minimum wage will not impact my business ...........59%Other ................................................. 3%Don’t know ....................................... 2%

$7.25–$8.20 ..................................27%$8.21–$9.15 ...................................26%$9.16–$10.10 .................................23%$10.11–$11.05 ............................... 11%$11.06–$12.00 ..............................13%

IMPACT OF RETIRING BABY BOOMERSWith 10,000 Baby Boomers retiring every day for the next 15 years, a majority of SMBs expect business impact from this generational workforce shift. 55%

SOME IMPACT

14%VERY BIG IMPACT

31%NO IMPACT AT ALL

For more survey results and data from the Q3 2014 SMB Job Generation Outlook,

download the full report here.

Join the conversation on Twitter @Lucas_Group.

HOW RETIREMENT IMPACTS COMPANIES

“Brain drain” continues to be the chief retirement effect expected by SMBs. (multiple responses allowed)

24% ENHANCES PROSPECTS FOR FUTURE INNOVATION AND GROWTH

34% IMPROVES ABILITY TO CONSIDER NEW APPROACHES & PROCESSES

64% CREATES A KNOWLEDGE GAP THAT’S DIFFICULT TO BRIDGE

16% IMPAIRS ABILITY TO COMPETE

4% OTHER