Hispanic small business owners are confident about their 2019 business outlook, with strong majorities planning for increased revenue, growth and expansion – eclipsing their non-Hispanic counterparts by double-digits on all indicators. According to the third annual Bank of America Hispanic Small Business Owner Spotlight, 79 percent of Hispanic business owners plan to grow their business over the next five years, 24 percentage points higher than non-Hispanic entrepreneurs (55 percent).Additionally, when asked about their outlook for next 12 months:
87 percent plan to expand (vs. 67 percent of non-Hispanic entrepreneurs).
74 percent anticipate their revenue will increase (vs. 57 percent of non-Hispanic entrepreneurs).
51 percent plan to hire (vs. 26 percent of non-Hispanic entrepreneurs).
“Consistent with years prior, Hispanic small business owners are embracing a significantly more confident outlook toward growth compared to their non-Hispanic counterparts,” said Elizabeth Romero, Small Business Central Division executive, Bank of America. “This optimism, however, does not come without challenges. As Hispanic entrepreneurs look to augment growth plans by hiring, today’s competitive job market has created an especially difficult environment to attract and retain talent.”
With business growing beyond expectations, Hispanics credit employees, family and community
More Hispanic entrepreneurs say their business has grown beyond what they originally envisioned when compared to non-Hispanics (34 percent vs. 25 percent). They credit employees, family and community as their primary sources of support and motivation in that success. More Hispanic entrepreneurs also see their businesses as multi-generational assets, with more than one-third intending to pass their business onto their children, compared to less than one-quarter of non-Hispanics.
Employees, community drive confidence: 91 percent say their employees give them confidence they can achieve their goals, while 86 percent are inspired to succeed by their community (compared to 86 percent and 69 percent, respectively, for non-Hispanics).
Power of personal networks: 86 percent say their supportive personal network helped drive their business success (compared to 76 percent of non-Hispanics).
A multi-generational investment: 38 percent hope to pass their business on to their children (compared to 23 percent of non-Hispanics).
Community impact opportunity: 22 percent said they became a business owner in order to make a difference in their community (compared to 17 percent of non-Hispanics).
Challenging labor market increases competition for talent
More than half of Hispanic entrepreneurs look to hire in 2019 – double the rate of non-Hispanic business owners. One potential obstacle, however, is finding qualified talent to fill these roles, with 58 percent of Hispanic entrepreneurs who sought to hire in 2018 reporting the ultra-competitive job market has impacted their ability to hire. As more than half of Hispanic business owners look to hire, they are also more likely than their non-Hispanic peers to report that retaining and hiring employees has become a significant challenge.
In the last year, 45 percent of Hispanic entrepreneurs experienced turnover (vs. 24 percent of non-Hispanic entrepreneurs).
Of Hispanic business owners who sought to hire in the last year, 45 percent say it takes three months or more to fill a position (vs. 40 percent of non-Hispanic entrepreneurs).
58 percent say the tight labor market had a direct impact (vs. 49 percent of non-Hispanic business owners).
Shifting hiring strategies with social media and deal sweeteners
Seventy percent of Hispanic entrepreneurs say they have refined their hiring and recruiting approach to better compete in this ultra-competitive job market (vs. 55 percent of non-Hispanic business owners), including:
More actively using social media to find and recruit talent (32 percent vs. 23 percent of non-Hispanic business owners).
Shifting to a more flexible culture (27 percent vs. 25 percent of non-Hispanic business owners).
Offering higher salaries (26 percent vs. 17 percent of non-Hispanic business owners).