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Business Owners' Optimism Starts To Inch Upward
Knowing exactly when the low point (or high point) of any fluctuation occurs is almost impossible without some distance from the events. According to a new survey, the low point of optimism for small business owners may have been last October.
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Knowing exactly when the low point (or high point) of any fluctuation occurs is almost impossible without some distance from the events. According to a new survey, the low point of optimism for small business owners may have been last October.According the findings of the latest American Express OPEN Economic Pulse, a semi-annual survey conducted in January and February of this year, business owners remain concerned about the economy. The survey attempted to hone in on how business owners perceive economic conditions, cash flow, hiring, access to credit, and the government stimulus package. The good news is that optimism has "stabilized." Among the findings the survey marshals to support that conclusion are:
Fewer businesses are worried about going out of business compared to October data (9% in August 2008, 18% in October 2008 and 13% in January 2009)
The number of business owners expected to grow their businesses regardless of the economic climate remains steady compared to October data (33% in August 2008, 23% in October 2008 and 25% in January 2009)
Although two-thirds of small business owners are stressed out over the state of the economy, they are less stressed than they were in October (55% in February 2008, 71% in October 2008 and 66% in January 2009)
Fewer businesses have been affected by the tightening of credit than they were in October (50% in August 2008, 63% in October 2008 and 56% in January 2009)
Fewer businesses are accepting lower profit margins than they were in August and October 2008 (56% in August 2008, 58% in October 2008 and 46% in January 2009)
Even in these turbulent economic times, the rewards and opportunities of running their own business outweigh the risks and challenges (80% in January 2009)
Though the survey does find indications that warrant some guarded optimism, it's not all on the up and up. Also included in the survey findings were these downers:
Fewer small business owners are planning to hire (38% in March 2008, 36% in August 2008 and 17% in January 2009) and more are planning to cut back (2% in March 2008, 3% in October 2008 and 8% in January 2009)
It is taking longer for small business owners to get paid (27% in February 2008 versus 36% in January 2009)
Small business owners are more averse to risk now than they were 12 to 18 months ago (75% in January 2009)
Though any indication of bolstered confidence is welcome news in the current economic climate, mindset is such a subjective and fluid state that it begs skepticism -- and any trend line, no matter, how flat, is celebrated.
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