2024 Economic Trends Accountants and Small Businesses Should Watch

Pennsylvania accountants and CPAs will have a lot of economic markers to watch during 2024 to help their clients, especially small- and medium-sized businesses, continue to grow. Work with your clients to develop strategies to properly ride the tide and, where possible, take advantage of opportunities to grow.

Inflation and consumer spending: Inflation is still causing pain for many consumers, but trends indicate that the inflation rate may be dropping. If this trend continues into 2024, we should see an improvement in consumer spending. However, many consumers have long memories and may be slower to return to earlier spending trends. Businesses should focus on customer experience and targeted marketing as well as market analysis in order to provide the products and services customers most want in 2024. 

Staffing: The level of job openings remains high but is dropping. This means small businesses may find it easier to get good employees. Companies should still try to woo good workers with a competitive salary and strong incentive packages to secure the best talent.

Interest rates: The current consensus among market analysts is that major central banks will likely resist further rate hikes while they measure the effects of having raised rates to cool inflation. There is no guarantee, however, that rates will not be increased again before they begin to drop. Accountants and business execs should work together to review investments and if possible postpone refinancing debt until rates return to more manageable levels. 

Growing in an unstable economic outlook

When the economy looks challenging for business, the most resilient companies and entrepreneurs take the environment as an opportunity to adapt and prepare for future growth. Some small business trends that could be implemented over the next year to help your clients thrive in this market include:

• Evaluating new ways to harness technology to improve customer service and productivity. Some of these may include online customer portals, automation in manufacturing or repetitive office duties, and new software solutions for efficiency or data analysis.
• Adopting flexible work models to draw the best talent, such as remote or hybrid employees. In a growing business, this model could allow for remaining in a current location rather than seeking larger quarters in a high-interest-rate market.
• Working with experts to develop agile business models that are poised to pivot and respond to market changes and maintain a competitive edge.
• Personalizing customer care to a greater degree through data insights and client feedback to strengthen current customer ties and build new ones.
• Integrating sustainability and green practices, where practical, into the business to reduce waste, support responsible resource providers, and respond to the concerns of consumers. 

Accountants can help their business clients grow in these challenging times. Business leaders should consider their accountants their trusted advisors and one of the most important members of their team in developing and implementing strategies to help the company grow into the future.