Small businesses are showing signs of recovery after a difficult year in 2011, according to the Capital One Small Business Barometer for the first quarter of 2012, released by Capital One Small Business today in conjunction with National Small Business Week. This quarterly survey of small businesses across the nation examines general economic indicators and small business perceptions of the economic environment, gauging current financial conditions and business projections for the following six months. Survey results for the fourth quarter of 2011 showed that small companies planned to take a deliberate and cautious approach to investments and hiring for 2012. First quarter 2012 results suggest this strategy has led to a strong start for small businesses this year, with many reporting increased liquidity and plans to increase spending on investments and growing their business.
Small business perceptions toward local economic conditions have improved significantly. Four out of five small businesses surveyed said their companies’ financial performance met expectations for the quarter. For the first time since the second quarter of 2011, the number of small businesses reporting better financial performance compared to a year ago is higher than those reporting that their financial performance is at the same level. The national business outlook indicates small businesses are upbeat about their current financial situation and improvement over 2011, but concerns over cash flow and the ability to acquire new customers are tempering their confidence about prospects for the remainder of 2012. Additionally, 15 percent of small businesses across the country currently have job openings that they are unable to fill.
“The latest survey results show some positive signs that more small businesses are beginning to focus on hiring, with the increase in the number of small businesses making plans to hire compared to the previous quarter at the highest level in over two years,” said Jon Witter, President of Direct, Consumer and Small Business at Capital One. “It is an encouraging sign that many businesses are looking to make long-term investments, and we are optimistic this trend will continue in quarters to come.”
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