Things are picking up in the franchising world these days. ADP Research Institute recently released its National Franchise Report for February 2016, which showed some favorable trends.
Employment is Increasing, Thanks to Franchises
Across the US, franchises boosted employment by 18,500 in February alone. The industry that saw the largest boost in new hires was, to no one’s surprise, restaurant franchises. In fact, of that 18,500, 14,400 were restaurant hires. Accommodations, business services, food retailers, and real estate also saw significant growth in February.
Photo Credit: ADP
How This Relates to the Bigger Picture
While numbers were up in February over January, they’re still shy of the two-year average for 2014-2015 when the average monthly change in US franchise employment was 22,900. The top industries for growth for the past two years were the same that are currently seeing positive change, and the top 6 industries as follows make up 83% of franchises in the US :
Automotive
Food
Leisure & Accommodations
Education
- Personal Products & Services
How Franchises are Faring Post-Recession
In 2008, the US saw a nosedive in employment as the economic recession hit full-force. But since then, something interesting has happened: the companies with the fastest rate of employment increase have been small businesses...many of which are franchises with under 50 employees.
Franchises: The Leader of the Pack
When you look at both the small business employment and the national employment market for the past few years, the franchise employment market has them both beat. In 2015, franchise employment growth was 3.5%, whereas it was 2.7% for small businesses and 2.4% nationwide.
That speaks to the fact that franchises are thriving, and will continue to serve as the cornerstone of employment in the United States.
Who’s Leading Franchises?
The data tells us that over the past two years, 53% of franchises are run by women. However, their income is only 80% of the average within the franchise, whereas for male owners, it’s 120%. This disparity is common across all industries in terms of women earning about 79% of what men earn .
Age, too, factors into franchise ownership. Millennials are turning out in droves to own franchises — 52% of franchises are owned by this age demographic. Other groups follow suit:
Generation X: 25%
Baby Boomers: 19%
- Other: 5%
The current state of the franchise industry in the US is promising, and the future looks bright for franchisees across the board.
Susan Payton is the President of Egg Marketing & Communications, a marketing firm specializing in content writing and social media management. She’s written three business books, including How to Get More Customers With Press Releases, and frequently blogs about small business and marketing on sites including Forbes, AllBusiness, The Marketing Eggspert Blog, and Tweak Your Biz. Follow her on Twitter @eggmarketing.