Small businesses across the country are seeing improved financial conditions and feeling optimistic about the months ahead, yet concerns about hiring and growth remain, according to Capital One’s second quarter 2013 Spark Small Business Barometer. This quarterly survey of small businesses across the nation examines small business perceptions of the economic environment, and gauges current financial conditions and business projections for the next six months.
Following are the key trends derived from this quarter’s survey:
- Financial optimism is on the rise: 45 percent of small businesses across the country are reporting that they believe their financial position will be better in six months, a seven-point increase from Q4 2012 (38 percent) and a two-point increase from Q2 2012 (43 percent).
- Small business owners are financially better off than a year ago: 35 percent of small businesses say their firm’s financial position is better than a year ago, compared with 18 percent who report that their financial position is worse – a significant improvement over Q4 2012, when a two-year high of 27 percent said their finances were worse.
- Positive sentiment on local markets: 64 percent of small businesses are optimistic about the economies where they do business, but slightly less than half (48 percent) are optimistic about the state of the national economy.
- Even in light of optimism, lack of plans to hire persists: 67 percent of small businesses do not have plans to hire in the next six months, a 1 point decrease from Q4 2012 (68 percent), but seven points higher than Q2 2012 (60 percent).
“Our survey results for the second quarter indicate that while optimism and confidence are on the rise and more small businesses are on sound financial footing, concerns and uncertainty continue to hold back plans for staffing increases and growth,” said Jon Witter, President of Direct, Consumer and Small Business Banking at Capital One. “While many small businesses have seen an uptick in sales over the past six months, this is not necessarily translating into significant new hires or investments in the business.”