American Express survey finds owners working more, taking less pay so they can recognize their employees' work and commitment this holiday season
MARKHAM, ON, Dec. 3 /CNW/ - Canadian small business owners are sacrificing their paycheques and bonuses this year so they can spread some holiday cheer to their employees, according to the American Express Small Business Holiday Monitor.
More than half of Canadian small business owners said they will make some sort of sacrifice in order to recognize employees and clients this year, whether it be not taking a raise (25%) or a bonus (23%), or even taking a pay cut (16%). Even with these sacrifices though, employers are being forced to cut back on their recognition of employees and clients this year.
Fewer small business owners will be giving their employees bonuses this holiday season (32 per cent this year versus 44 per cent last year). They are also less likely to make charitable donations (33% vs 40%), give employee gifts (37% vs 42%) and give client gifts (31% vs 35%).
But small business owners recognize the importance of showing their appreciation to employees and clients, and are finding less expensive ways to do so. About half are still planning to treat their employees to a party or dinner this holiday season - the same proportion as last year. Another lower cost way to recognize employees is by giving them extra time off. This year, 43 per cent are planning to give employees extra time off over the holidays, up from 39 per cent last year.
"Small business owners know that their employees are key to their company's success," said Howard Grosfield, VP & General Manager, Small Business Services, American Express Canada & International. "They are willing to make sacrifices to ensure their employees feel valued and appreciated. We've monitored that trend throughout the recession and owners consistently put the needs of their staff and business first."
One respondent, a small electronics retail and services business owner in central British Columbia, said his employees are like family, and not giving them a gift would be the wrong thing to do. Knowing that it has been a particularly tough year for his staff, he began working longer hours several months ago and saved the profits specifically for an employee holiday party. Even though his business has suffered a serious slowdown, he expects this year's party to be "better than ever."
Cost Savings Still Need to be Found, but Owners Bear the Brunt
But while small business owners attempt to shield their workers from the effects of the year-end slowdown, the reality of the recession has made cost savings a priority. In response, about three quarters of respondents have introduced some form of cost reduction policies in the last year for themselves and/or employees.
That includes 48 per cent who have instituted longer working hours, 47 per cent instituting pay freezes, and 45 per cent reducing spending allowances. Perhaps more dramatically, almost one quarter of firms (23%) have actually introduced pay cuts in the past year.
In implementing these cost-saving strategies, the survey again found a spirit of giving in owners themselves who absorbed much of the impact to protect their employees. Nearly half (48%) took at least one cost-savings measure that impacted themselves only - not their employees. In companies where pay had been cut, more than half of owners took the reduction themselves without asking the same of their employees. Another 32 per cent cut their own spending allowances without asking staff to follow suit.
One change that employees have been asked to endure where owners are exempt is shorter working hours. For those firms that reduced working hours, 59 per cent of the cuts were to employee hours only, with owners extending their own hours to pick up any slack.
A Look to 2010
On a brighter note, while 47 per cent of small businesses saw a drop in business this past year, more than two thirds are "optimistic" that their financial position will improve in the coming year. This has been a consistent finding from American Express Monitors throughout the year: businesses expect to turn a corner very soon.
"Clearly, 2009 has presented small business owners with a number of challenges, as evidenced by the half that have experienced a downturn in their business," Grosfield said. "But small business owners have been careful to plan for the eventual turnaround, and it is encouraging to see they are hopeful about the future of their business."
About the American Express Small Business Holiday Monitor
From November 20 to November 23, 2009, Angus Reid Public Opinion conducted an online survey on behalf of American Express Small Business Services among a randomly selected, representative sample of 414 Canadian small business owners who currently have two to 100 employees. The margin of error for the total sample is +/- 4.9%, 19 times out of 20. The results have been statistically weighted according to the Statistics Canada Business Register's most current business size and region data to ensure a representative sample of the entire population of small business owners in Canada. Discrepancies in or between totals are due to rounding.
About American Express Small Business Services
American Express Small Business Services (SBS) is dedicated exclusively to the success of small business owners and their companies. SBS supports business owners with exceptional service. With tailored products and services, the team delivers purchasing power, flexibility, control and rewards to help customers run their business. Specifically, business owners can leverage an enhanced set of products, tools, services and savings, including charge and credit cards, robust online account management capabilities and savings on business services from an expanded lineup of partners. To obtain more information about SBS visit www.americanexpress.ca/smallbusiness.
About American Express in Canada
American Express in Canada operates as Amex Bank of Canada and Amex Canada Inc. Both are wholly owned subsidiaries of the New York based American Express Travel Related Services Company, Inc., the largest operating unit of the American Express Company. Amex Bank of Canada is the issuer of American Express Cards in Canada. Amex Canada Inc. operates the Corporate Travel, Travel Services Network and Travellers Cheques divisions in Canada. American Express opened its first offices in Toronto and Hamilton in 1853 and now employs 3,700 Canadians coast-to-coast.
SOURCE American Express
For further information: For further information: or a full copy of the report, please contact: Cheryl Kim or Tom Sargent, Edelman, (416) 979-1120 ext. 305, 250, email@example.com, firstname.lastname@example.org