The United States may have ended 2009 with an unemployment rate of 10 percent, but those people who were employed are getting paid more and are getting more employee benefits than in the past, according to the U.S. Small Business Administration (SBA).
Between the fourth quarter of 2008 and the same period in 2009, employers increased workers' wages, salaries and benefits, albeit modestly, suggesting some employer optimism for the future of their businesses, according to the SBA's Quarterly Indicators report.
Despite small business owners' tendency to remain tentative about expanding and hiring, the University of Michigan's consumer sentiment survey and the National Federation of Independent Business's small business optimism index both ended the year at higher levels than their 2008 averages, suggesting stronger confidence in the economy than last year.
The U.S. economy appeared to "rebound" in the fourth quarter—real GDP grew by an annualized 5.7 percent. Indicators noted, however, that the majority of the growth was due to inventory replacement, but contributing factors were growth in real personal consumption and real exports, and the slowing growth of imports.
Although 310,000 of the year's 4.8 million lost jobs were cut in the fourth quarter, the overall pace of net job loss slowed, and the service sector experienced some net job gains. Industries that saw job gains included professional and business services, education and health services, and natural resources and mining. While self-employment has been a necessary career move for many Americans who have lost their jobs due to the economy, self-employment for 2009 was down slightly from recent years.
Small business owners have pointed to lack of credit as one of their main problems in expanding their businesses, and the Senior Loan Officers' survey confirmed that there is an ongoing weakness in small business demand for commercial and industrial loans. Lending guaranteed by the SBA continues to be a bright spot for small businesses, with average fourth-quarter 7(a) lending up 144 percent more than the dollar value of the loans in the first quarter of 2009. Lending for SBA 504 loans was up 87.8 percent from the first quarter. The SBA's 7(a) program is its main loan program for small businesses, while the 504 loans are targeted at increasing employment.
