More than three in five small businesses and 51% of mid-sized businesses rate the economy as “poor” or “fair,” while at the same time, 51% of small businesses and 73% of mid-sized businesses rate their own operations as “good” or “excellent,” the data showed.
“Business owners are more optimistic the closer they are to their region, industry or company,” Kristina Talkowski, senior vice president and head of Nationwide’s mid-market business lines, told Propertycasualty360.com. “This optimism ultimately aligns with economic indicators that show a resilient economy, but also reflects ongoing challenges related to high interest rates, material and labor costs.”
She added that it is clear that business owners are facing challenges, “but they have embraced those challenges and are taking proactive steps to improve their operational strengths and resilience. I think this preparedness has contributed to owners’ optimism about where their own businesses stand, as most feel prepared to weather a major disruption in the future or even expand their operations.”
While remaining optimistic about their own operations, small and medium-sized businesses face a series of internal challenges, including worker benefits, optimizing operations and expenses, the survey found.
“Health insurance and possibly optional benefits like pet insurance certainly play a role in attracting and retaining talent,” Talkowski said.
“When it comes to property and casualty insurance, business owners who report rising employee wages should be aware of the impact on their workers’ compensation premiums, which will also increase as wages increase,” she added. “With these internal and external pressures, business owners are unsurprisingly looking to optimize their costs, with many viewing their insurance as a way to save money, while agents and insurers can help ensure business owners are not sacrificing long-term protections for short-term savings.”
The survey found that 34% of small businesses and 39% of mid-sized businesses say their employees want better pay, while 25% of small businesses and 40% of large businesses say their employees also want better benefits.
Meanwhile, 83% of small businesses and 77% of midsize businesses have reviewed their commercial insurance policies online or with their agent in the past six months, according to the survey, and more than a third of midsize owners have dropped a policy or lowered their coverage limits during that time.
Talkowski also highlighted generative AI as another evolving need and challenge facing the workforce.
“It’s important for employers to have policies in place to govern the use of ChatGPT and other AI tools to ensure the security of their data and work processes,” she said. “For workers, this can have benefits, such as increased efficiency, but also drawbacks, with 43% concerned about the impact of AI on their job security.”
While most companies have invested in AI, the survey shows that mid-sized companies are “more likely” to invest today.
According to the data, only 27% of small businesses have invested in AI, while 63% of mid-sized businesses have invested money in this technology.
