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Monday, 12 January 2009 11:46

Surprisingly bright outlook among small IT business owners

Information and communications technology is one of the most optimistic sectors as far as small business owners are concerned.

According to the latest MYOB Australian Small Business Survey, 83 percent of owners in the ICT sector say their business is currently doing very or quite well (a bigger proportion than any other sector), and a well above average 68 percent are extremely or fairly confident in their future business prospects.

The figure across all sectors was 61 percent (well down on the 72 percent recorded in March 2008). The most optimistic sectors in the latest survey were education (76 percent), accommodation, cafes and restaurants (73 percent) and wholesale trade (71 percent).

The latter contrasts markedly with the retail trade, which was one of the least optimistic with only 58 percent being extremely or fairly confident.

Given that the survey was conducted after the financial nasties hit the fan in the spring, Australian small business owners are showing a remarkable level of optimism about how well their own businesses will actually perform during 2009.

A surprising 46 percent said they expect their businesses will be performing better than they are now, with ITC coming in slightly higher at 48 percent.

And it seems they are prepared to put their money where their mouths are, with 37 percent expecting to invest in their own businesses during the next six months - make that 46 percent in the ICT sector.

What does that mean for employment in the small business sector? Please read on.

If you work for a small business, then your employment prospects for the next 12 months might not be as bad as you may fear.

44 percent of the sample were sole traders that don't intend to hire staff, so we can leave them to one side.

Among the remainder, 35 percent expect staff numbers to remain stable, 14 expect to take on more people, and only 4 percent foreshadow staff cuts.

Recasting those figures as percentages of employing small businesses, over 92 percent expect to maintain or increase staff numbers.

When we look at a breakdown by industry, the IT sector is slightly above average, with 16 percent expecting to hire more employees, vs 14 percent overall.

But if you think your next job may be in a small business, be prepared to network - finding new staff through friends, family and existing employees is still the most common method, with more than twice as many owners using this means as any other.

And don't give up on newspaper ads - small businesses are still more likely to advertise vacancies in the press than online.

However, there are signs that rose-tinted spectacles may be in use by business owners.

When owners were asked about the outlook for their industry, the story was very different. Only 17 percent expect things to improve. And ICT is the least optimistic sector, with a mere 7 percent expecting things to get better.

Among the survey's other findings, the proportion of small businesses with a web site remains flat at 40 percent. This is practically the same as in the March and June 2008 surveys, though there was a dip to 35 percent in September.

Curiously, 45 percent have registered a domain name. Presumably some of those are using it for email only.

The survey was carried out by AMR Interactive for MYOB during November and December 2008 and involved a sample of 1385 small business proprietors, 42 of them in the ICT sector.


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Stephen Withers

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Stephen Withers is one of Australia¹s most experienced IT journalists, having begun his career in the days of 8-bit 'microcomputers'. He covers the gamut from gadgets to enterprise systems. In previous lives he has been an academic, a systems programmer, an IT support manager, and an online services manager. Stephen holds an honours degree in Management Sciences and a PhD in Industrial and Business Studies.



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