The past few years of economic recession have been tough for small businesses, but some recent economic trends are showing signs for optimism. According to this article on the Elance blog, a recent poll conducted by the Wells Fargo/Gallup Small Business Index found that small business owners are feeling more optimistic about their growth prospects. They’re planning to spend more, hire more and invest more in the growth of their companies.
This is good news for small businesses and by extension for the rest of the U.S. economy. When small businesses feel optimistic, they spend more money on inventory, office space, raw materials and supplies. They’re more likely to hire extra help (rather than cut buck) in anticipation of future demand from customers. If you want to start a business, or if you’re running a small business already, these are all encouraging signs.
Here are a few reasons for optimism from the latest small business survey by Wells Fargo/Gallup Small Business Index:
- More small businesses are ready to hire: 22% of business owners surveyed said that they are planning to hire more people during 2012, compared to only 8% of business owners who said they are planning to cut jobs. Hiring is a big commitment for a small business, and it’s not done lightly. Such a high percentage of small businesses looking to add jobs (compared to the number looking to cut jobs) is a good sign that business owners see an increase in demand on the horizon. Many small businesses try to hire ahead of demand so they can accommodate additional orders and new customers.
- Small businesses are ready to spend more: 28% of small business owners said they are planning to increase capital spending in the next 12 months. This is the highest level in four years! This is a very good sign, because many businesses cut back severely on capital spending (equipment, facilities, computers, technology) during the long recession. More capital spending by small businesses means more business opportunities for other small businesses. If you want to start a business that sells equipment, technology, services or professional expertise to other businesses, this uptick in capital spending will mean more sales for you.
Could it be possible that the worst of the economic downturn is over, and companies are ready to start hiring, spending and investing again? It’s dangerous to read too much into any one survey, but this small business report is a positive sign.
Are you trying to decide whether to take the plunge and start a business of your own? Perhaps this latest economic news is a sign that “the sun is coming out” again on the economy. There are people just like you who have started a business and run a small business even during the worst times of the recession, and they’re still surviving and thriving.
Maybe one of the small businesses that starts hiring in the next 12 months…could be your own!