The economic confidence of small business owners continues to slide, according to a newly released survey.
In April, 24 percent of owners said conditions were looking up, down from 45 percent at this time last year and hitting the lowest reading since Discover Business Card’s Small Business Watch survey began in August 2006. Overall, the Discover Small Business Watch declined to 76.1 in April, down from 77.8 in March.
“Small business owners are clearly cautious about the economy and demonstrating resiliency,” said Sastry Rachakonda, director of Discover’s business credit card, in a statement. “While their sentiments may be influenced by broader market conditions, their business cash flow situation has improved over the last month.”
The numbers of owners who say economic conditions for their businesses are getting worse has slipped considerably. A year ago, less than a third described conditions as worsening, but in April nearly one out of every two business owners said they believe the situation is getting worse.
Fifty-five percent of small business owners rate the U.S. economy as “poor” compared to 53 percent who said the same in March. The combined percentage of small business owners who rate the U.S. economy as “excellent” or “good” remained unchanged this month at 16 percent.
Forty-four percent say they have experienced cash flow issues over the last 90 days, a slight decrease from 47 percent in March.
Only 27 percent of owners say they plan to increase spending on business development in April, while 44 percent plan to decrease spending. Both of these data points are the lowest results for this question since the Watch’s inception 20 months ago.
Three-fourths of small business owners say that rising gasoline prices have an effect on the profitability of their business. Among this group, 86 percent are affected negatively.
