Small businesses have an increasingly pessimistic outlook about the economy and where it’s heading, according to the Job Creators Network Foundation (JCNF)’s latest Small Business IQ poll.
According to the poll, 72 percent rate the U.S. economy as either fair or poor, but among companies in the South, that percentage is 80 percent. Also, 55 percent say the direction of the economy is getting worse, with 64 percent in the South saying so.
JCNF has been polling small businesses monthly since May 2021. In November, JCNF contacted 500 small businesses across the United States: 79 percent had fewer than 10 employees. Although the survey included businesses in four regions, 35 percent were in the South region.
While there has been some debate nationally about the definition of a recession, 60 percent overall and 73 percent of businesses in the South believe the U.S. economy is already in a recession.
Overall, 43 percent of businesses and 46 percent in the South give the Biden Administration an F rating for its performance with small businesses. Only 24 percent overall and 20 percent in the South gave the administration an A or B rating.
“Small business sentiment is souring as we enter the holiday season, which should be sending off alarm bells within the Biden administration,” said Elaine Parker, President of JCNF. “Entrepreneurs are feeling pessimistic because of high inflation, the threat of tax increases associated with government programs like the proposed $400 billion illegal student loan bailout, and more government red tape.”
The top three concerns among businesses, by a significant margin, are higher prices/inflation, economy/client spending, and general operating costs. Fully 80 percent of businesses expect to have to raise consumer prices and 71 percent think those increases will be significant.
But as Simon Medcalfe noted in his ABD column this week, the economy is sending mixed signals, and that’s evident in this poll as well.
While businesses are increasingly concerned about the overall economy, they appear to have more confidence in their individual businesses – 79 percent say they are in good or excellent financial condition, with more than a third (37 percent) reporting their finances better than a year ago. Another 45 percent expect their financial condition to improve in the next three months.
The full Job Creators Network report is available here.
