A recent poll which surveyed 1,000 small business owners during the month of April showed a jump in business confidence that matched the all-time quarterly increase in the poll’s history.
The quarterly poll is a joint project of MetLife and the U.S. Chamber of Commerce. The survey produces the Small Business Index. The current Index score is 68.7, up 3.1 from last quarter.
Some bullets from the report:
Manufacturers turn bullish.
Small business manufacturers’ optimism took a big leap in Q2, with 69% feeling positive about the national economic outlook, a substantial 16 percentage point increase from last quarter. However, nearly two-thirds of manufacturers (62%) believe the cost of healthcare crowds out other priorities for their business.
Small businesses hold investment, staffing levels steady.
Twenty-seven percent of small business owners plan to increase investment in their company over the next year, continuing a trend from the last two quarters. Twenty-eight percent plan to increase staff in the next year.
Female business owners become more optimistic.
Last quarter, the survey reported a significant gap between male-owned businesses (more positive) and female-owned businesses (less positive). However, female-owned businesses have optimism this quarter only 1% below that of male-owned businesses.
Millennial and Gen X-owned small businesses drive hiring plans.
Plans to increase headcount are primarily driven by Millennial or Gen-X-owned businesses (39%) despite representing only 27% of survey respondents.
Other notable findings from the survey include:
- Regionally, more small businesses in the South plan to increase investment in the coming year compared to last quarter, while the opposite is true for those in the West.
- At the sector level, manufacturers are the most likely to report increasing investments.
- More than half of small businesses (57%) report expectations that next year’s revenues will increase. Another third (34%) expect revenue to stay the same, while just 7% think it will decrease.
- The number of small businesses reporting good health remains consistent, with 65% of small businesses reporting that their business is in good health. Business size impacts perceptions of health: the smallest businesses are least likely to believe they are in good health.
- Small businesses in their second decade of operations seem to be in an optimism sweet spot. They are most optimistic about their business health (71%), compared to both younger and older businesses. Those in operation for less than 10 years (62%), as well as those around for 20 or more (64%), are both less optimistic about their health.
The full survey results may be reviewed at https://www.uschamber.com/sbindex/.
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William Bruce is an Accredited Business Intermediary (ABI) and Senior Valuation Analyst (SVA) assisting buyers and sellers of privately held businesses in the transfer of ownership. His practice includes consulting services nationally on issues of business valuation and transfer. He currently serves as president of the American Business Brokers Association. He may be reached at (251) 990-5934 or by email at Will@WilliamBruce.org.