World Business

Most results of small trade surveys released at the end of 2008 were bleak, showing respondents continue to labor with a bad economy

By Karen E. Klein

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Even as retailers suffered and the stock market closed out one of its worst years, the December Discover Small Business Watch showed a slight uptick in optimism amid small business owners compared by dint of. November results, when confidence levels hit their lowest marks ever.

The December measure of relative economic confidence rose to 21%, up six points from November but only slightly higher than the previous low of 20% recorded by the survey. Just into the bargain half—51%—of respondents said they felt business terms were getting worse. That configuration is slightly down from the 54% recorded in November, said Ryan Scully, director of Discover’s (DFS) business credit card. Commissioned by the Discover Business Card, the survey recorded responses about economic conditions from 1,000 business owners with fewer than five employees.

"Since the beginning of 2008, the index has trended down. With the turn of the new year, there seems to have existence some wary optimism, but we’ve seen the numbers teeter-totter up and down over the year, with a antecedent ear in August," Scully said.

It’sitting hard to say whether the slight upturn in self-reliance is the beginning of a trend or just reflects succor that 2008 was coming to a close, he before-mentioned. Other possible causes for optimism include starting a new year, hoping for better stock place of traffic performance typical of January, and a commencing Presidential administration encouraging a comprehensive relating to housekeeping goad package.

Also, as we cast last spring, it’s notoriously difficult for a survey to accurately gauge the mood of small business owners as a whole, since they’re such a large and amorphous group. How a point is phrased and to what sub-set of small business owners it is posed can journey a big difference in a survey’session outcome.

Whether or not small business owners are beginning to suffer more optimistic, most small business survey results released in the final weeks of 2008 reflected a grisly reality. The Small Business Poll of more than 800 business owners published in December by the National Federation of Independent Business Research Foundation was notable for the number of worst-ever results it reported. For instance, the sum up of small business owners reporting higher sales in the foregoing three months plunged 25%, the lowest response in the survey’s 35-year history; the reports of declining sales were the largest in the survey’s account; and the number of owners who said they planned to create unused jobs in the next three months fell 4%, any of the worst numbers in the view’s history (the only times the numbers were lower were during the 1974-75 and 1980-82 recessions).

The Discover survey showed that 69% of molecular business owners think the economic recovery will attack at least 12 months. Still, 24% said they planned to greaten expenditure on business development in the next six months, an increase from the 20% who responded affirmatively to that question in November. And while 51% in November said they planned to decrease business spending, fewer—47%—said the same in December.

Only 12% of survey respondents said they felt the system was getting better, what one. seems like a very low number, Scully aforesaid, but it is the highest response rate the survey has gotten to that investigation since August 2008.

Despite the reports of tightened give faith to availability, solely 7% of those surveyed listed financing and credit as their biggest business question, Scully said. The NFIB data backed up that discovery: 31% of respondents to that prospect said that all their borrowing needs had been met, compared to 7% who reported problems obtaining funding.

The full age of respondents in the Discover survey—30%—cited decreased sales as their most worrisome trouble, followed by higher operating costs (23%) and 17% who cited taxes. Nearly one-fifth of the entrepreneurs surveyed (17%) said their companies had not been inferior to emphasis in the past year.

The bright spot in the drumbeat of bad survey news came in hiring. More than two-thirds of weak businesses surveyed by TriNet, a human resources consultancy with headquarters in San Leandro, Calif., said they planned to hire repaired employees in 2009. The November TriNet HR Trends survey in addition showed that 80% of the 500-plus respondents tried to make new hires in 2008, one and the other to handle new growth or to make up for attrition.

Original text: http://www.businessweek.com/smallbiz/content/jan2009/sb2009015_822243.htm?campaign_id=rss_smlbz