Despite headwinds from supply chains, inflation, and labor shortages, small business owners are forecasting a strong year ahead, according to the 2022 Women & Minority Business Owner Spotlight, a new report from Bank of America exploring the outlook of entrepreneurs nationwide.
The report is based on a survey of more than 1,300 small business owners across the country, with additional insights into gender and ethnicity, and found that revenue expectations rose to a seven-year high, and expansion plans increased significantly since the spring. Over the next 12 months:
- 66 percent of business owners expect revenue to increase — a seven-year high.
- 52 percent plan to expand their business — up from 37 percent this spring.
- 83 percent plan to obtain funding for their business — up from 70 percent this spring.
- 77 percent of entrepreneurs say their business is equipped to survive a recession.
“As we look ahead to 2023, small business owners are optimistic about the future, even with ongoing economic challenges and uncertainty,” says Sharon Miller, president of small business and head of specialty banking and lending at Bank of America. “The data underscores what we’ve seen time and time again: the continued resilience of small business owners whose success remains foundational to our local and national economies.”
When asked about their primary concerns, small business owners identified inflation (75 percent) and commodities prices (69 percent) as their top concerns, followed by a potential recession (67 percent), the U.S. political environment (66 percent), and interest rates (65 percent) rounding out the top five.
A majority (88 percent) say inflation and supply chain issues (80 percent) are continuing to impact their operations, leading to price increases.
Amid labor shortages, business owners reported that their hiring plans are reaching the highest levels in seven years, with 38 percent planning to hire in the next 12 months. The majority (61 percent) of business owners say labor shortages are currently impacting their business, up from 41 percent in the spring. Among those business owners impacted:
- 49 percent are working more hours
- 31 percent are raising wages to attract competitive talent
- 30 percent are having difficulty filling job openings
The report also includes specific insights on the perspectives of women, Black, Hispanic-Latino, and Asian American and Pacific Islander (AAPI) business owners, examining key areas including access to capital, business outlook, social change, and community.
More than a quarter (29 percent) of women business owners surveyed said they do not think they will ever have equal access to capital, while 40 percent of Black business owners, 27 percent of Hispanic-Latino business owners, and 22 percent of AAPI business owners said the same.
Minority business owners reported more challenges accessing capital for their businesses than the national average, with 46 percent of Black and Hispanic-Latino business owners and 55 percent of AAPI business owners reporting they’ve personally faced challenges.
Black business owners were most likely to say they are concerned about credit availability — with 57 percent of Black business owners expressing concern in the survey compared to 45 percent overall.
Women business owners have an overall positive business outlook, while confidence in their business and the broader economic landscape is more tempered than their male peers. Over the next 12 months:
- 63 percent expect revenue to increase compared to 68 percent of male business owners.
- 47 percent plan to expand their business compared to 57 percent of male business owners.
- 38 percent are confident that the national economy will improve compared to 50 percent of male business owners.
Overall, women business owners say they face more challenges in business than their male counterparts, with the majority (59 percent) saying they must work harder for the same success as men.
Fifty-five percent of Black business owners say racial justice and equity are important causes for their business, compared to 30 percent of non-Black business owners. Eighty-seven percent of Black business owners say they are committed to driving social change through their business, and two in five have active pledges or commitments toward social causes through their business, including volunteering, making operational changes and monetary commitments.
As a result of these efforts:
- 61 percent say they have increased sales.
- 40 percent say they deepened ties to their community.
- 34 percent say they have increased their customer base.
In addition, Black business owners are more optimistic than their non-Black counterparts about their business outlook. Over the next 12 months, 72 percent expect revenue to increase compared to 63 percent of non-Black business owners, while 65 percent plan to expand their business compared to 50 percent of non-Black business owners.
A majority (86 percent) of Hispanic-Latino business owners are committed to building generational wealth through their business — compared to 77 percent of non-Hispanic-Latino business owners.
Community involvement is a priority, too: 88 percent of Hispanic-Latino business owners say they actively give back to their communities, taking actions such as donating products or services, volunteering, and sponsoring local events and teams.
Additionally, Hispanic-Latino business owners are more optimistic than their non-Hispanic-Latino peers about their business outlook. Over the next 12 months, with 71 percent expect revenue to increase compared to 65 percent of non-Hispanic-Latino business owners, and 59 percent plan to expand their business compared to 52 percent of non-Hispanic-Latino business owners
AAPI business owners report strong support systems, as 80 percent say their family supports their business. Providing for the next generation is also top of mind, with 82 percent of AAPI business owners aiming to build generational wealth through their business. Additionally, more than one in three (37 percent) AAPI business owners said they received guidance on starting their business from family members.
When asked about their business outlook for the coming 12 months, 62 percent of AAPI business owners said they expect their revenues to increase, while 60 percent said they plan to expand their business compared to 52 percent of non-AAPI business owners.
Ipsos Public Affairs conducted the Bank of America 2022 Women & Minority Business Owner Spotlight survey online between July 26 and August 17, 2022, using a pre-recruited online sample of small business owners.
Ipsos contacted a national sample of 1,308 small business owners in the United States with annual revenue between $100,000 and $4.9 million and employing between two and 99 employees, as well as 357 interviews of Hispanic small business owners, 369 interviews of Black small business owners and 150 interviews of Asian American small business owners.
For an in-depth look at the insights of the nation’s small business owners, please read the full Bank of America 2022 Women & Minority Business Owner Spotlight by clicking here.
