Franchise Sector Expects to Create More American Jobs for American Workers in 2017
FOR IMMEDIATE RELEASE
FRANCHISE SECTOR EXPECTS TO CREATE MORE AMERICAN JOBS FOR AMERICAN WORKERS IN 2017
Optimism following election poised to boost small business franchise entrepreneurs and job creation
WASHINGTON, Jan. 24 – Following an election focused on bringing back American jobs, the International Franchise Association today unveiled its annual Franchise Business Economic Outlook: 2017 report. The report finds the industry significantly outpaced the US economy in 2016, and projects a similarly strong performance in 2017.
“The Trump administration has made clear that creating more jobs in America for Americans is its number one priority. The franchise sector has shown for the seventh year in the row that it is meeting this test,” said IFA President and CEO Robert Cresanti. CFE. “We believe that our industry will continue to grow especially if the business environment improves, which could happen if the Trump administration and congressional leaders deliver on their promise to roll back onerous regulations and pass much-needed tax reform.”
Key findings from the 2017 report prepared for the Franchise Education and Research Foundation by IHS Economics include:
- Franchise employment grew 3.5% in 2016 and is expected to continue growing by another 3.3% in 2017, adding nearly 250,000 new jobs.
- Franchise establishments grew 1.7% in 2016 and are expected to grow 1.6% in 2017, an expected increase of over 11,500.
- In 2017, US GDP is projected to grow at 4.7% in nominal dollars, while the franchise sector is expected to outpace that at 5.2%, growing to $426 billion. The franchise sector will continue to account for about 3% of US private GDP.
- Franchise output was up 5.8% in 2016 and will continue to grow another 5.3% in 2017, surpassing $700 billion.
- Within the franchise community, the number of establishments is expected to grow fastest in Personal Services, at 2.3%, followed closely by Quick Service and Full Service Restaurants, each projected to grow at 1.9% in 2017. The two restaurant business lines will continue to lead in employment and output growth.
While the outlook for the economy and especially for franchise businesses looks positive in 2017, and there is expectation that federal regulatory relief will further enhance opportunity, uncertainties remain about the speed of changes under the new administration as well as some new legislative priorities that could have negative impacts on franchising.
“Our industry is optimistic, but we are monitoring closely the public policy arena particularly issues like the new joint employer standard, to ensure on-going job growth provided by franchised businesses,” stated Cresanti.
New polling results conducted by Morning Consult on behalf of IFA show strong support to reverse the new joint employer standard and allow franchises ability to operate as independent businesses in neighborhoods across the country. According to the data, 66 percent of voters would like the Administration and Congress to focus on policies that support local ownership of stores and restaurants while 74 percent have a favorable opinion of franchise businesses in their communities.
IHS Economics Senior Economist Karen Campbell added that “the report’s in-depth look at franchising sectors and performance in individual states provides a complete snapshot of franchising in 2017, and will help policymakers understand the potential benefits of this growth.”
About the International Franchise Association
Celebrating 56 years of excellence, education and advocacy, the International Franchise Association is the world's oldest and largest organization representing franchising worldwide. IFA works through its government relations and public policy, media relations and educational programs to protect, enhance and promote franchising and the more than 733,000 franchise establishments that support nearly 7.6 million direct jobs, $674.3 billion of economic output for the U.S. economy and 2.5 percent of the Gross Domestic Product (GDP). IFA members include franchise companies in over 300 different business format categories, individual franchisees and companies that support the industry in marketing, law, technology and business development.
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