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On the Road to Economic Recovery, There Are Numerous Positive Signs

Small Business | SMALL BUSINESS REPORT

March 15, 2006|Cyndia Zwahlen | Special to The Times

Hopper is gearing up to halt new efforts to revisit the overhaul of the workers' comp system, proposed health insurance mandates, business tax increases and the widening use of eminent domain. But he is still optimistic, pointing to what he sees as state legislators' renewed focus on small business as a creator of jobs.

* Healthcare: More than half of California's smallest companies, 52%, no longer offer healthcare benefits to their employees, according to Union Bank's recent survey of almost 2,000 business with annual sales of less than $10 million.

The message is clear: Healthcare is increasingly out of reach of small-business employees. The survey found that among companies that offer health plans, 25% have shifted more of the cost to employees while reducing health benefits. That's an 11-percentage-point increase since 2003.

Of the 49 million uninsured Americans, 51% are small-business owners, their employees and dependents, according to the independent business federation.

Hopper and his group are pushing for passage of legislation that would allow small businesses to participate in association health plans as a way to cut insurance costs. A key U.S. Senate committee is expected to vote today on the plans, which are being touted as small-business health plans. Opponents say the plans are a ruse to escape costly but necessary state insurance regulations.

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Cleareyed View

Despite the continuing battles, small-business owners remain optimistic and determined to optimize their chances for success.

New leaders at the Latin Business Assn. in Los Angeles, for example, have pushed initiatives including the group's first trade mission to China.

"All of our trends at this point are very positive," said Rick Sarmiento, new chairman of the association.

Yet Sarmiento, owner of a Valencia consulting firm, Ultimate Partnership, offers a caveat: Today, more than ever, it takes a strategic approach, an understanding of what's going on in the economy and a cleareyed view of the competition to survive and thrive as a small-business owner.

"If you ignore those elements, it's going to be very hard to maneuver through," Sarmiento said. "And that's one of the greatest advantages to being a small business: the ability to maneuver quickly."

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Cyndia Zwahlen can be reached at cyndia.zwahlen@latimes.com.

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