52% of Small Businesses See Conditions Worsening in Next Six Months

The headline gives one of the results of a Rasmussen survey of small businesses commissioned by Discover (hat tip DoctoRx). Note only 22% expect improvement, with the rest either foreseeing no change or not volunteering a view.

Small businesses are the engine of hiring, and as we noted earlier, they have cut back severely on their hiring plans. The current survey shows only marginal improvement from a depressed level. The most troubling finding is the majority of small businesses plan to cut spending further:

The number of small business owners who think the economy is getting worse was down to 49 percent from 53 percent in November; while 24 percent of small business owners see the economy staying the same, up from 16 percent in November; 25 percent see the economy getting better, down from 28 percent in November; and 2 percent are not sure…

35 percent rate the current economy as fair, up from 30 percent in November; while 61 percent rate it as poor, and 4 percent rate it as good or excellent.

18 percent of owners say they will increase spending on business development activities such as advertising, inventories and capital expenditures in the next six months, 26 percent will make no changes, 51 percent plan to decrease spending, and 5 percent are not sure.

51 percent of owners have experienced cash flow issues in the past 90 days, down one percentage point from last month; 45 percent of owners have not experienced cash flow issues, and 4 percent aren’t sure.


Originally published at Naked Capitalism and reproduced here with the author’s permission.