From the Advocate
From the AdvocateMay 2023
Who Can You Trust? Americans say: Small Business
Polling company Gallup first measured the national “confidence in institutions” in 1973 and has done so annually since 1993. Gallup now takes the temperature for 16 institutions, asking survey recipients to rate each of them from “I have a great deal of trust” to “I have no trust at all”.
The trend has been pretty much downhill since 1973. Every year, Gallup reliably turns out a headline saying – and I paraphrase here — “Americans trust just about everybody even less than last year”.
But there are two exceptions to this overall depressing pattern: the military and small business.
These two not only trade off as the most trusted institutions on the list, but have posted Steady Eddy trustworthiness scores over the lifetime of the exercise.
In the latest version of this poll, small business again took the top, “most trusted” spot with 68 percent of Americans saying they have a “Great deal/Quite a lot” of trust in this institution. That’s four points higher than the next institution on the list, the military, and 23 points higher than #3, the police.
Since 1973, trust in public schools, the church, the criminal justice system, police, the presidency, the Supreme Court, banks, newspapers, television news, and big business have all seriously eroded. Congress is down to single digits…pretty soon Gallup will have to remove it from the list! But trust in small business has ranged from 57-75 percent since Gallup added it to the list in 1998.
American trust in small business as an institution not only survived COVID-19, it went up.
So, as we celebrate Small Business Month in California this May, I want to ask one question: what is it that makes us feel so strongly about small business?
Don’t get me wrong: I trust small business too. Obviously!
But I want to know Why and the Gallup poll doesn’t ask about that.
These results just beg so many more questions for me:
What do people even think about when they refer to small business as an “institution”?
How is it possible that Americans gave small business the highest score across 18 years of polls – 75 percent in June 2020 — at a moment when small businesses across the country were shut down and the government was devoting billions of dollars to saving them?
And how does this high level of trust compare to small business owners’ own sentiment, their confidence in themselves?
Fortunately, I found some clues in the Google-verse.
The U.S. Small Business Administration defines a “small business” has having fewer than 500 employees.
But when pollsters and pundits refer to “small business”, most people think Mom-and-Pop: family-owned and operated, usually operating in a single location, and frequently restaurants, small retail and personal services like your hairstylist.
So we could say that this feeling of trust is just the Cheers theme song taken root in the collective consciousness: we equate “small business” with those organizations who know our names and we trust people who know our names.
But I think it’s more than that…
The proof is in that June 2020 Gallup poll result: at the height of the crisis, the very moment that state and federal governments were spending billions to help small businesses survive, our emotional reaction as a nation was to trust even harder in the resiliency of our neighbors and local communities. So it’s not about business outcomes: we trust small businesses even when they are most vulnerable, even when the doors are literally closed.
This Small Business Month, the COVID-19 public health crisis is officially behind us; the Governor ended the state of emergency in February. We’ll probably spend the next 10 years trying to figure out what we learned from it all.
As I travel the state this month to recognize and applaud individual business-owners, I believe the biggest lesson of COVID-19 was not economic, it is our collective recognition of the importance of small businesses as cultural institutions. We share a tangible sense of the relationship of these businesses to our communities; they are part of our physical and emotional landscapes and their importance to our sense of well-being only grew in their absence during the COVID-19 shutdowns.
Another recent survey asked why recipients prefer to shop at local, family-owned businesses and the answers really make my point for me:
- Helps my community – 39%
- My money goes to a business that needs it – 37%
- Better quality – 34%
- More tailored to my area/needs – 32%
- Transparency about sources – 32%
- Fair treatment of all employees – 31%
- Fewer middle men – 31%
- Needs of consumers come first – 30%
These beliefs are rooted in cultural values that prize and praise “rugged individuals”, “the little guy”, “the average Joe”, the “straight shooter”.
Even when we’re in the midst of an economic crisis – especially then! — we look to the action and agency of individuals to save ourselves. What better example could there be than the Moms and the Pops of the world?
It’s telling that, if you look at the demographic breakdown of the Gallup trust poll, high levels of trust in small business runs true across all age groups and even across political parties…except for the categories of “non-white” and people without a college degree. Trust in small business as an institution drops by 10 points for each of these groups, both of which face significant systemic barriers to participation in our cherished American tradition of entrepreneurship. I could write a book on this topic but, for this month, suffice to say that pulling yourself up by your bootstraps is harder if you can’t afford boots.
So what about small business-owners themselves? How much trust do they feel in small business as an institution? Gallup has nothing to say on this.
But extrapolating from the Bank of America 2022 Small Business Owner Report, I want to say that America’s business-owners also have a strong belief in their own resiliency. Bank of America says that a whopping 88 percent of small business owners say that inflation is hurting their business; at the same time, their confidence in both local and national economic outcomes dropped precipitously in 2022 compared to the same report in 2021. And yet…64 percent of them think their revenue will go up this year, four percentage points higher than last year, and 62 percent say their business is fully or partially recovered from the pandemic.
How do I explain that? Well, maybe it just takes an eternal optimist to become an entrepreneur.
Maybe when we say we trust in small business, we Americans are really saying that we trust in their no-matter-what power of positive thinking.
As Small Business Advocate, my priority is to help underserved businesses and communities to be able to feel this as strongly as everyone else. Because I also trust, implicitly and wholeheartedly, in the “institution” of small business.
