The Franchise Business Economic Outlook for 2010 is forecasting a 2 percent increase in the number of business-format franchises next year — to the tune of 18,000 new establishments. The good news is that will be a gain of 36,000 jobs after watching 400,000 jobs disappear in 2010. The gross value of goods and services produced by franchise businesses (aka economic output), is forecast to increase 2.8 percent to $868.3 billion—an increase of $23.6 billion in 2010.

Business owners not jumping in bed with lodging franchise

Business owners not jumping in bed with lodging franchise

“We are pleased that the 2010 outlook for franchise businesses is projected to be more positive than 2009, but access to credit remains a major hurdle to increase jobs and economic output at the levels we have seen during past recoveries,” says International Franchise Association president and  CEO Matthew Shay.

And — surprise! — lodging is expected to feel this crunch more than its fellow franchise systems, according to the IFA in D.C. Employment is expected to decline in lodging (-2.4 percent) while increasing in 8 other sectors, with the largest percentage increases expected in real estate (1.3 percent), quick service restaurants (0.8 percent), retail food (0.7 percent) and personal services (0.7 percent). Lodging is the only sector of the top 10 expected to decline in the number of establishments, too. Quick service restaurants, on the other hand, will see the biggest jump at 3.1 percent new units.

“The U.S. economy is expected to experience slow growth in 2010 as the nation begins to recover from the recession. The Franchise Business Economic Outlook for 2010’s macro view of the economy anticipates nominal gross domestic product (GDP) to grow 3.8 percent, while economy wide employment is projected to increase 0.4 percent in 2010,” says Drew Lyon, principal in PricewaterhouseCoopers’ National Economics & Statistics practice. “Our forecast is for output of all franchise business sectors to expand modestly in 2010 as the recovery takes hold.”

Photography: MoToMo (Flickr)


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