New York Fed releases Puerto Rico Small Business Survey
The Federal Reserve Bank of New York conducted a survey in the Commonwealth of Puerto Rico focused on gathering information from small businesses. Small businesses in Puerto Rico employ more than 80% of all private sector workers. The survey took place from March 2016 through May 2016, and 1,295 firms responded to the survey. The final result came out in November 2016. The survey questionnaire focused on three broad areas: information about the respondent’s, firm demand for credit, and a special topics section addressing training as well as growth opportunities.
Some of the most important highlights include::
- About 43% of respondents had 11 or more years of experience in business. 20% of respondents had 6-10 years of experience, while a combined 37% of respondents had 0-5 years of experience in business.
- Since 2015, 41% have been a full-time employee for 0-1 years. 11% have been a full-time employee for 2 years. This shows an increase in the level of full-time small business employment in the last year.
- 38% have an annual revenue of less than $50,000.
- 79% of small business’ did not gain any revenue from online sales and 81% did not gain any revenue from exports
- 41% of small business’ reported making profits, and 20% reported that they broke-even with their profits. 34% reported that they lost profits, while 5% of respondents were unsure or declined to answer the question
- 27% had an increase in revenue and 19% reported no change. A whopping 54% reported that their revenue has decreased.
- 41% reported that the biggest business challenge they face is managing cash flow, while 27% said that dealing with rising business costs was their biggest challenge
- 45% of respondents did not apply for credit. Of these respondents, 37% said that the primary reason their firms did not apply for credit was because they did not want to accrue debt.
- 55% of respondents applied for credit. Of these respondents, 40% of them reported that the top reason they applied for credit was to meet operating expenses.
- 45% of the business’ applied for credit up to $25,000.
- 29% of all applicants received partial funding. Of these applicants, 22% listed insufficient collateral as their reason for partial funding.
- 33% of all applicants received zero funding. Of these applicants, 23% reported insufficient collateral as their reason for zero funding.
- 19% listed Contract/sales to federal government as their top ranked training needs. 15% listed growing internet sales as their training needs, and 15% listed starting/growing exports as a training need.
- 45% said improved access to capital and credit are the most helpful for growing business. 18% reported that streamlining business regulations are the most helpful in order to grow business.
This is a wealth of information that can be used to help solve Puerto Rico’s economic problems.
If you wish to dive deeper into the statistics, go here to learn more.