Firms plot growth, but doubt persists

Though pessimistic about the economy, many Massachusetts small-business owners still plan to invest in their companies and hire more workers in the coming year, according to a new survey.

''Small-business owners see the market for what it is," said Tony Nuzzo, managing director of business banking New England for Citizens Bank. ''But they feel because of their individual abilities they can grow in any environment."

Nuzzo said that's a key finding of the first Citizens Bank/Babson College Small Business Pulse Survey. The plan is for the survey to take the state's small-business pulse twice a year.

At least half of companies surveyed plan to increase capital expenditures in the coming year. While 5.5 percent expect job cuts, 41 percent intend to hire more employees.

What's worrying small-businesses owners are employee health insurance costs, insurance costs in general, the availability of skilled labor, and the challenge of retaining workers. The survey defined a small business as one with annual revenue of $10 million or less.

Among small businesses that recently looked to fill job openings, 44 percent said there were insufficient numbers of qualified applicants, the survey found.

There are ''deeply embedded workforce concerns," said Stephen Spinelli Jr., vice provost for entrepreneurship at Babson College, who helped analyze the data.

According to the survey, 44 percent of small businesses surveyed believe the economic climate is worsening.

On the upside, small businesses have had an average growth rate of 29 percent over the past three years. Many of the firms with the highest growth had bonus or profit-sharing plans for managers and other key employees, the survey found.

The telephone survey, conducted in July, contacted 600 firms.

Chris Reidy can be reached at reidy@globe.com.