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Half of Small-Business Owners Think Government Should Help More An annual survey of sentiment among the owner of small businesses finds only one in four thinks the government is doing enough for business.

By Brian Sutter Edited by Dan Bova

Opinions expressed by Entrepreneur contributors are their own.

Mikael Törnwall | Getty Images

Despite the White House's concerted efforts to talk about its support of U.S.. small businesses, the small businesses themselves aren't feeling much love for the government.

According to the 2016 State of Small Business Report, half of them say the government isn't doing enough to support them. Only 24 percent of them said government was doing enough.

Why is there such a disconnect?

It could be that small businesses are facing challenges and uncertainties brought around by government actions.

"One thing small business owners want and need is some degree of certainty when it comes to the law and taxes," explained David Nanney, a CPA who works with small businesses in Memphis, Tennessee. "They haven't had that for quite a few years, which can make it difficult for them to plan and get ahead. There have been constant changes coming from government bodies such as required fees and permits, employment law, new taxes and more."

The top challenges facing small businesses in 2016.

The State of Small Business Report, which is conducted annually by Wasp Barcode Technologies, revealed the top challenges facing small businesses in 2016 are hiring new employees (50 percent), increasing profit (45 percent), employee healthcare (43 percent) and growing revenue (43 percent). The data is from a nationwide survey of more than 1,100 small business owners and executives.

Those challenges may be difficult to overcome. Despite 50 percent of small businesses saying they plan to hire in 2016, a recent NFIB Small Business Jobs Report noted, "…85 percent of those hiring or trying to hire reported few or no qualified applicants for the positions they were trying to fill."

While 43 percent of small businesses acknowledge increasing revenue as a challenge for 2016, research from U.S.. Bancorp shows very few small businesses have been able to do so during the last five years. In 2015, only 28 percent of them reported an increase over the previous year. Forty-three percent of U.S.. small businesses cite employee healthcare as one of their top challenges for 2016, a 14 percent increase over 2015. The change comes as small businesses with 50 or more employees must now meet requirements for healthcare coverage as mandated by the federal Affordable Care Act. The challenge hit employers with 100 or more full-time employees in 2015 when they were mandated to provide government-approved coverage plans or face financial penalties.

Related: What Business and Government Should Do When Innovation Outpaces Regulation

Massive paperwork steals time from building business.

The government-related challenges, especially employee healthcare, facing today's small businesses aren't primarily a financial issue. They're a time issue – time business owners must spend making sure they comply with government regulations rather than using that time to serve customers, boost revenues and provide more jobs.

According to regulations.gov, on average, federal agencies and departments issue nearly 8,000 regulations per year. That equates to roughly 22 regulations every day.

Consider the time impact of complying with just a few elements of the Affordable Care Act.

Businesses that have 50 or more full-time employees (or full-time equivalents) are now subject to new IRS reporting requirements and must complete two additional forms related to healthcare coverage. According to Nanney, each form is supposed to take just 15 minutes to fill out, but that neglects the hours of accounting, eligibility determination and data collection time that must be put in before the business owner can even start the reports.

Even it is just 15 minutes per form, that's an extra 30 minutes per year spent on paperwork. Multiply that by the 161,000 small businesses with 50 or more FTE. That's 80,500 hours – 3,354 days - spent on paperwork for just ONE government requirement.

The NFIB reported that small businesses owners feel like government requirements and regulations are holding them back from growing and hiring more employees. While the 2016 State of Small Business Report indicated 50 percent of them said the plan to hire this year, the hiring some of them have been forced to do doesn't do much to boost their bottom lines.

During the December 2015 Congressional hearings on "How the Administration's Regulatory Onslaught is Affecting Workers and Job Creators", Ralph Beebe, the owner of a Michigan-based engineering company told Congress, "To keep up with red tape, I've had to hire a dedicated compliance worker. I'd much rather hire another welder, someone who could help us do more work and compete for more clients."

Related: Federal Government Hopes to Get a Grasp on the Sharing Economy

Government support – or lack thereof - impacts small business.

The impact is felt by more than just Beebe and other small business owners.

"All of these extra time and financial costs force small businesses to focus on the bare necessities, which can mean no capital expenditures or no raises for existing employees," said Nanney. "This has a macro effect on everyone."

The construction firm can't hire the contractor. The contractor can't buy the new truck he needs for his business. The car salesperson can't get the truck commission she needs to hire a plumber.

And the plumber can't hire the accountant and lawyer he needs to keep up with all the government rules and regulations.

Related: 7 Loan Programs Offered by the SBA

Kim Keller co-wrote this article.

Brian Sutter

Director of Marketing, Wasp Barcode

Brian Sutter is the director of marketing at Wasp Barcode, responsible for the development and execution of the company’s marketing strategy. His role encompasses brand management, direct and channel marketing, public relations, advertising, and social media.

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