CHARLOTTE, N.C. – Nearly 4 out of 5, or 78%, of small and midsize business owners anticipate revenue growth in the next 12 months, according to the 2024 Bank of America Corp. Women & Minority Business Owner Spotlight.
The survey found that this optimistic outlook spans demographics, with 84% of Black/African American, 83% of Asian American and Pacific Islander, 82% of Hispanic-Latino and 76% of women entrepreneurs anticipating revenue growth in the year ahead.
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Published annually in partnership with the Bank of America Institute, the survey was conducted online from Aug. 7-21 by Ipsos and asked more than 2,000 small- and midsize-business owners throughout the United States about their business outlook, access to capital, how they manage their employees and how they interact with their community.
Small businesses were defined as businesses with annual revenue between $100,000 and $4.99 million and employing between two and 99 employees, while midsize businesses were defined as businesses with annual revenue between $5 million and $49.99 million and employing between two and 499 employees, according to the survey methodology.
“These businesses are the heart of the U.S. economy and business owners are expecting to increase their revenue in the coming year, despite continued concerns around inflation,” said Raul Anaya, president and co-head of business banking for Bank of America. “Many also plan to hire and invest in employee education, such as training and mentoring programs, as they prioritize their labor force and explore opportunities for growth.”
Nationwide, two-thirds, or 66%, of those surveyed said they believe the local economy will improve, while 60% said they believe the national economy will improve and 57% said they believe the global economy will improve.
However, smaller employers were less optimistic, with 50% of small-business owners planning to expand and only 39% planning to hire over the next year, compared with 78% of midsize employers planning to expand and 61% planning to hire.
“Finding quality labor is one challenge facing many smaller firms, though employment growth is still strong, and our clients continue to be optimistic about staffing,” said Sharon Miller, president and co-head of business banking for Bank of America. “In the year ahead, they are looking to invest in their employees and utilize technology to bolster their hiring and improve client experiences.”
Inflation topped the list of concerns among business owners, with 70% saying it is an issue, followed by the U.S. political environment [67%], the 2024 U.S. presidential election [65%], as well as interest rates and a potential recession [both at 62%].
More than half, or 57%, of women business owners plan to expand their business in the year ahead, using a variety of strategies, including growing their customer base [65%], creating an online presence [48%] and utilizing professional services [35%].
Hispanic-Latino business owners report strong confidence in the economy, with 94% planning to obtain funding, 78% planning to expand their business, 76% expecting the national economy to improve and 64% planning to hire more employees over the next year, according to the survey.
These sentiments were echoed by Esmeralda Hernandez, founder and CEO of Beauty Creations, a cosmetics company based in Los Angeles.
“We continued to scale across key growth measures this year – revenue, hiring, client growth and physical expansion – and remain confident this momentum will continue into the new year,” she said. “Despite some lingering uncertainty about inflationary costs and other economic pressures, we feel strongly about our growth projections. It’s a good time for our business overall.”
However, 81% of Hispanic-Latino business owners said labor challenges are still impacting their business, with 33% saying they are raising wages to attract more competitive talent and 33% saying they are working more hours personally due to staffing shortages.
Over the coming year, 94% of Black/African American business owners are planning to obtain funding for their business and 77% are planning to expand. The survey also found that Black/African American entrepreneurs are prioritizing personalized customer interactions, with 70% noting the importance of this tactic to attract and retain customers. In addition, 92% said they are adjusting their marketing strategies and approaches, with 54% saying they are increasing their presence on social media and 45% saying they are offering personalized deals and discounts to individual customers.
Nearly three-quarters, or 73%, of Asian American and Pacific Islander business owners plan to expand their business over the coming year, while 71% believe the national economy will improve, 70% believe their local economy will improve and 60% said they are planning to hire more employees.
And many of these business owners are utilizing technology and artificial intelligence tools to assist their hiring efforts, with 91% of Asian American and Pacific Islander business owners reporting they used AI as an approach to staffing in the past year, which is nearly 30 percentage points higher than non-AAPI business owners, according to the survey.
