Health Insurance: A Big Woe For Small Companies

By RICHARD BREEDEN
Staff Reporter of The Wall Street Journal.

From The Wall Street Journal Online

The cost and availability of insurance continues to top the list of the most important problems that small businesses face.

In a survey conducted by the National Federation of Independent Business in November, 28% of the companies polled cited insurance as their biggest problem, compared with only 19% a year earlier, a 47% jump.

Taxes take second place at 18%, and poor sales follow at 16%. Inflation, which hit the all-time high in the history of the survey when 41% of the small businesses picked it as the most important problem in early 1974, hardly worries anyone today, being cited by only 1% of the businesses polled.

And interest rates and the availability of credit, which holds second place on the all-time list of woes with 37% in 1982, joined inflation in November as a concern of only 1% of the companies polled.

In November, government regulations and red tape were cited by 11% as the most important problem; competition from large businesses, 9%; quality of labor, 8%; and costs of labor, 5%.

Although taxes topped the list a year ago, when cited by 20% of the companies polled, insurance has held the lead during the past year, and the federation says it will remain an issue for the foreseeable future.