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Government could be dragging down small firms


While small business insurance is something many firms need to protect themselves from potential detractors, recent research suggests it may be more critical than ever before as company owners are becoming increasingly discouraged by what is happening in the nation's capital. A new study conducted by Pepperdine University and Dun & Bradstreet showed 31 percent of small-business owners believe instability in Washington, D.C. is taking away from the opportunities they have to bring in new employees, while 42 percent of respondents said government regulations, in regards to banking, healthcare and taxation are some of top reasons why the economy is having difficulty getting back to pre-recession levels.

The US has taken on too much debt
Small businesses are seen as a barometer for the country, and if they are bogged down by the government, achieving growth is difficult. One factor holding small firms back is the government's habit of increasing the debt limit. The research revealed only 58 percent of respondents support an increase of the United States debt limit, while nearly eight in 10 did so last year. After seeing that acquiring more debt hasn't helped them, small-business owners are growing sour toward policies that allow the government to continue to dig a deeper hole.

"We talk to small business owners every day, and we hear the frustrations and dismay," said Terry Robinson, president at Sunovis Financial. "They are unable to access credit, they are being stymied by regulations and are worried about growing their businesses – or even surviving in some cases. We think this is a serious problem for the U.S. in general, since small business is the engine of the economy."

Hiring is severely limited
When small-business owners are hiring, their companies achieve growth and the economy looks better, but when they are not, it is hard to acquire new customers. Forty-five percent of respondents said they are not planning to do any hiring in the upcoming six months, while more than three-quarters will only hire up to two employees. By keeping the same staffing levels, small-business owners have to scale down their growth prospects, but not all hope is lost. Twenty-eight percent of respondents believe tax incentives could increase hiring and 26 percent said increased access to capital could be beneficial.

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