New Citibank Survey: Small Businesses Find Silver Lining in Recession

NEW YORK--(BUSINESS WIRE)--A new survey sponsored by Citibank has found that some small business owners and managers are finding a silver lining in the current recession, including an increase in the number of high-quality candidates available for hire, rising employee retention rates and gains in market share.

“They are resilient and are making the best of the situation even when business conditions are not ideal.”

While the majority of small business owners and managers surveyed say the recession is not over yet, 32 percent say the availability of high quality talent for hire has improved, while 24 percent say their share of business versus the competition has improved, with gains most common among companies with 20 to 99 employees (34%) and those in the wholesale and retail trades (31%). Among companies with 20 to 99 employees, 36 percent reported an improved commitment and work ethic in employees, 31 percent reported improved employee retention, as did 20 percent of companies in the manufacturing and construction industries, which can mean significant savings in recruitment and training expenses.

“Small business owners are demonstrating their grit in adapting to the challenges of today’s economy. Our survey findings point to this fact and our bankers see it everyday in working with their clients in our branches across the country,” said Maria Veltre, Executive Vice President of Citi’s Small Business Segment. “They are resilient and are making the best of the situation even when business conditions are not ideal.”

The survey indicates that many small business owners and managers are adapting to what some commentators have dubbed "the new normal” in today’s slow-growing economy. About a third say that during the recession, they’ve made permanent changes in the way they do business. And forty-one percent say they have at least made temporary adjustments, including:

• Nearly four in 10 are asking current customers for more business and for referrals.
• About one-third are doing more networking with other small business owners.
• 60 percent say they are spending less on advertising.
• About half are cutting back on payroll services and employee recruiting services.
• 42 percent say they’re making greater use of their company’s website to generate business leads and sales.

The survey also reflects small business owners’ continued passion for their work and their commitment to weathering the storm. Despite the challenges many are facing, 69 percent say they would start their own business again and 59 percent would recommend small business as a career to their children or other young people.

The omnibus poll was conducted for Citibank Small Business via telephone by GFK Roper during the period August 20-27, 2009 and surveyed a sample of 500 small business executives across the United States. The margin of error is approximately +/- 3.5 percent.

About Citibank

Citibank is a member of Citi, the leading global financial services company, which has approximately 200 million customer accounts and does business in more than 140 countries. Through its two operating units, Citicorp and Citi Holdings, Citi provides consumers, corporations, governments and institutions with a broad range of financial products and services, including consumer banking and credit, corporate and investment banking, securities brokerage, and wealth management. Additional information may be found at www.citigroup.com or www.citi.com.

© 2009 Citigroup Inc. Citibank, N.A. Member FDIC. Citibank and Arc Design is a registered service mark of Citigroup Inc