MCLEAN, Va. (
) -- Despite a pessimistic outlook on the economy, an increased number of small business owners plan to add staff in the coming months, according to
third-quarter Business Barometer survey.
The quarterly survey encompassed a national sample of 1,901 small business with less than $10 million in annual revenue, from Sep. 14 to Oct. 5, with adjustments based on data provided by Dunn and Bradstreet and the U.S. Department of Commerce.
When asked if they planned on increasing spending during the fourth quarter, only 16% of the survey participants responded positively, which was down from 21% the previous quarter. The survey also said that 36% of participants planned on hiring new employees over the next six months, which was up from 32% the previous quarter.
Nearly three quarters of business surveyed agreed that they were "able to access the financing they need," while 22% said they didn't have necessary access to credit or financing.
When asked where they would turn for financing expansion of their businesses, 52% of participants said they would rely on banks or other commercial lenders, which was consistent with prior results, but 40% said they would dip into personal savings, which was up from 35% the previous quarter.
Only 27% of the survey participants said that economic conditions for their business was improving, which was down from 32% in the second quarter and 39% during the first quarter.
Over half (51%) of small businesses surveyed said their financial position was steady from a year earlier, which was an increase of 8 percentage points from the previous quarter, while 36% said their financial position had improved from the previous year, which was down 7 points from the previous quarter. Only 18% reported worsening financial condition, which was the same level as the previous two quarters.
Robert Kottler, Capital One's executive VP for small business banking said the survey results "suggest that financial performance is stable for many of the small businesses we surveyed, but some respondents have a more cautious outlook about their growth and expectations for the broader economy and their business," adding that it was a good sign that "most small businesses believe they have access to the credit and financing they need and many are making plans to increase their workforce and begin hiring again."
Written by Philip van Doorn in Jupiter, Fla.
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Philip W. van Doorn is a member of TheStreet's banking and finance team, commenting on industry and regulatory trends. He previously served as the senior analyst for TheStreet.com Ratings, responsible for assigning financial strength ratings to banks and savings and loan institutions. Mr. van Doorn previously served as a loan operations officer at Riverside National Bank in Fort Pierce, Fla., and as a credit analyst at the Federal Home Loan Bank of New York, where he monitored banks in New York, New Jersey and Puerto Rico. Mr. van Doorn has additional experience in the mutual fund and computer software industries. He holds a bachelor of science in business administration from Long Island University.