Businesses still eyeing expansion

NEW YORK — Ron Pierce has one eye on expanding his information technology business and the other on something he can’t control: the economy.

“I’m not afraid to expand my company, but I realize that a recession may be coming and that any expansion could have me reducing my staff,” said Pierce, owner of Trinity Solutions in Greensboro, North Carolina. But he is going ahead with his plans.

Pierce wants to grow by buying other IT companies. He believes businesses will need his services, which includes helping them upgrade to new technologies and systems, whatever the economy is doing. A recession could make his expansion plans easier because prices for companies are likely to fall in a downturn.

Many small businesses are expanding and plan to continue doing so even if the economy continues to slow.

Some might not need to worry about a recession because their products and services are in great demand. IT companies like Pierce’s are one example, and another is businesses selling security and surveillance systems for homes and commercial buildings.

But other owners are strategizing to make sure their companies are in

a strong position to both expand and weather a downturn. They’re more selective about the clients they work for or are changing the focus of their business to one less vulnerable to the economy.

There are already signs that some owners are cautious. The number of small-business jobs counted by payroll provider ADP has slowed in the past few months. ADP customers with under 50 employees added 11,000 jobs in July after cutting a total of 45,000 in May and June; that compared

to a gain of 66,000 in April.

Although many companies are having a hard time finding qualified staffers for their open positions, others are holding off on hiring as the economy slows: The gross domestic product fell to an annual growth rate of 2.1 percent in the second quarter from 3.1 percent in the first quarter. Another sign: The number of businesses sold has fallen the past three quarters, according to Bizbuysell. com, an online marketplace for small companies.