How are small business owners feeling about the state of the economy and their own prospects? Depends on who is doing the asking.
In two conflicting surveys conducted by two big banks, the answers and outlooks are decidedly mixed.
Chase for Business said on Tuesday (May 3) that its 2016 Business Leaders Outlook took the pulse of roughly 1,000 small business leaders, finding that 69 percent of those responding showed optimism about their individual prospects looking down the road through the next year.
That optimism is segmented regionally, however, as 53 percent of those surveyed said they felt optimistic about the local economy, 43 percent had a sanguine outlook about the national economy’s prospects and only 27 percent said they felt positive about the global economic prospects.
Key initiatives include the movement to embrace financing, with an eye on growth, specifically with the intent to boost staffing levels and also, as would be relevant to payments, broaden use of mobile banking. The growth in staffing and digital operations dovetails with the fact that a majority of those responding expect to see their sales grow in the next 12 months, and they also look for attendant profit growth. With staffing prospects, hiring would span both full- and part-time staff, as 25 percent of small business owners polled by Chase want to take on more full-time workers and 31 percent deign to hire part-timers.
Drilling down a bit, larger businesses — defined as those with revenues of $500,000 to $20 million — are, in fact, less optimistic about the national economic prospects than was seen last year, at 46 percent versus a year ago at 57 percent.
Separately, and in contrast to the optimism displayed in the aforementioned Chase survey, the spring 2016 Bank of America Small Business Owner Report — itself gauging the sentiment of 1,000 small business owners — found that a meager 29 percent of business people would say they feel strongly that there will be improvement in the U.S. economy over the next year. One reason for the gloominess is none other than the presidential election, with a whopping 67 percent stating that the race (and, of course, the winner) will have “a lot” — or, at least, “somewhat” — of an impact on their business prospects. The whopping majority of respondents, at four of five, stated that they have concerns over the government and how effective leaders across various branches might be.
Expectations for revenue growth are comparatively muted when viewed against the Chase report, with a slight majority, at 51 percent, looking for revenue growth through the next 12 months. Only 22 percent of owners will boost hiring through the same timeframe. Only 9 percent plan to seek funding tied to growth initiatives.
Among key concerns raised by SMBs responding to the Bank of America survey: costs. Specifically, health care, which concerns a majority, at 75 percent. And wages, where minimum wages would be on the rise, also were top of mind in the survey.