Small Business Owners Still See a Recession, Survey Finds
Even though the economy is improving, small business owners remain cautious. A survey released Thursday from U.S Bank found that 85 percent of respondents also think the economy will still be stuck in a recession this time next year, even though more small business owners (64 percent) reported that revenue was in line with or higher than last year.
“We are heartened to see the outlook improving, but there is still work to do. Small-business owners are starting to see the recessionary clouds part, but for many, the recession remains,” said Rick Hartnack, vice chairman and head of consumer and small business banking at U.S. Bank.
This cautiousness is reflected not only in the thoughts of small business owners but the actions as well, as 70 percent of small businesses intend to keep staffing levels flat, while 22 percent intend to hire in the coming 12 months. Although this is slightly up from one year ago, it's not nearly as high as America would like to see.
Perceptions of banking and lending has also improved as banks increased their focus on small business. The number of small business owners who viewed their banks as helpful to their business in the past year jumped seven points to 43 percent, as did the number who say their bank provides them with everything they need (up 10 points to 32 percent). Small business lending is also up due to the Small Business Jobs Act of September 2010. This act increased loan limits and enhanced loan provisions, among other benefits for small businesses.
Despite all that, small businesses are still fretful about the state of the economy.
The random survey of 2,923 owners of businesses with $10 million or less in annual revenue was conducted between April and May across the 25 states the bank serves. It also looked at regional conditions in Arizona, Northern California, Southern California, Colorado, Illinois, Minnesota, Missouri, Ohio, Oregon, Washington and Wisconsin.