The economic condition is gradually showing a positive transformation. With the small business houses generating more employment and expanding their infrastructure, the experts hail it as a good sign for the growth and development of the economy.
According to the recent study by the National Federation of Independent Business, the owners are taking up new ventures, which are evident from the increase in the jobs that has doubled over the last six months. During the pre-recession levels, the generation of jobs was showing a downward graph. However, this scenario started showing a drastic change with as many as 82,000 jobs created in firms, previously having 49 or less employees in July. Payroll processor ADP providing the statistics also added that number of small business enterprise and new franchises has also increased, as the corporate are willing to make investments in new areas and take risks.
This has a positive impact on the government and the insurance agencies. The employers need not be concerned about the new health care law that requires a greater insurance coverage for the employees. Economists, like Moody believe that some small enterprises are hiring people on a part-time basis to avoid the insurance coverage. According to the law of United States of America, only the full-time workers are liable to receive the benefits of insurance coverage of the country. Therefore, these employers quite strategically are not enrolling the newly hired under the permanent pay-rolls. The organization with 50 or more employees must provide insurance to people who are working for thirty hours per week.
Marisa DiNatale commented that though there is a recent increase in the employment generation but it also includes about 77% of part-time jobs. These new jobs are created in hospitality and restaurants. These two sectors are prone to using more part time employees than permanent ones. This view clearly contradicts the statistics of the federal government. According to the Labor Department 75, per cent of the jobs of the current financial year are full time.
The chief executive officer of Jacksonville based Firehouse of America, Don Fox says that their company has plans to establish 2500 restaurants across the country. It will also add 140 Firehouse Sub store in the current fiscal year, most of which will be owned and managed by the franchisees.
According to the Stats of Federal Deposit Insurance Corporation, the borrowing amount of the small project has increased up to 10 per cent in the year 2013. Contrarily, though the business endeavors have increased manifold but sale of franchisees has not shown any momentum. In 2012, the sale made 4.9 per cent gain, whereas in the current year it is just 4.3 per cent, as per the data of the International Franchise Association.
Another expansion in the market in ensured by the loan guarantees program by the small business franchisees. The undersized business organizations can take loans through Small Business Administration; this scheme has risen to 13 per cent in the October – March period of the previous financial year.
Comments are closed.