Teeth of worries of an economic downturn, one sector is poised for another year of estimable growth in 2016, according to one study.
Bolstered by trends including acceleration in transaction spending, the franchise industry is set to grow by 1.7 percent in 2016, go together to the study by the International Franchise Association. The annual outlook follows a stronger-than-expected 2015, which saw an estimated 1.7 percent increase, according to the association’s Franchise Business Economic Outlook for 2016 that was prearranged by IHS Economics.
The 1.7 percent growth forecast for this year purposefulness bring the total number of U.S. franchises to 795,932.
Among franchises, hiring and job beginning trends are also expected to be strong. The IFA forecasts employment increases of 3.1 percent to 9.1 million franchise procedures, up from last year’s 8.8 million jobs. Plus, unqualified GDP generated by the franchise industry will reach $552 billion, up from $523 billion in 2015, it bid. The index has shown growth every year since 2010.
“These [franchise] flocks have cultures that tend to grow and rise because they competition consumer needs in various spaces, whether it’s dog walking or hotels you choose to stay at,” said IFA President and CEO Robert Cresanti. “As a function of that, it regularly scales up.”
While potential risks include flat government assign, franchises could benefit as investors looks for options outside the oil period, with crude oil prices plunging.
“The fundamentals of consumer spending are unquestioned and business investment outside of the oil industry is beginning to accelerate,” the report indicated. “By most measures, the franchise sector will continue to grow at rates that beat the economy-wide growth of industries, where franchises are concentrated.”
Despite his gay outlook, Dorfman, like many franchise owners, is wary of abruptness accelerate bumps, including rising wages and the Affordable Care Act. This year, functions with as few as 50 full-time employees face fines for not offering wage-earners adequate coverage.
“We don’t yet have 50 full-time employees, but as we continue to swell, the ACA has a serious financial impact on me,” Dorfman said. “As we look to maintain and misprise costs, it’s a balancing act between full-time and salary and hourly” workers, he give the word delivered.
Also on the minds of franchisees is a decision on joint-employer status from the Resident Labor Relations Board in a case that involves McDonald’s.
If the plank ultimately rules McDonald’s is a joint employer, corporations would be stood accountable for what happens at individual chain locations.
Cresanti mean some business owners are already adjusting their business designs in advance of any possible changes, which ultimately costs businesses numerous.
Correction: This story has been updated to reflect the number of full-time workers Robert Dorfman has.