Small business owners are the most optimistic they have been in five years.
This is according to the latest Wells Fargo/Gallup Small Business Index, which found small business owners expect their businesses to increase cash flow and hire more employees in 2014.
The Wells Fargo/Gallup Small Business Index survey was conducted January 6 – 10, 2014.
The overall score increased to a positive 45 (+45) in January 2014, up from a positive 24 (+24) in October 2013. This score is the highest it has been since the third quarter of 2008, although still well below pre-recession levels.
According to the survey, several factors contributed to this quarter’s increase in small business owner optimism compared to fourth quarter 2013:
Improved cash flow: In the January survey, more small business owners said they had good cash flow over the past 12 months than they did last quarter (52% in Q1 2014 compared to 46% in Q4 2013). A larger majority of business owners also expect to have good cash flow in 2014 (57% in Q1 2014 compared to 52% in Q4 2013).
Increasing hiring: More small business owners said they expect to increase hiring in the next 12 months than in last quarter’s survey (22% compared to 16%).
Increasing revenue: A larger percentage of small business owners expect their revenue over the next 12 months to increase (48% compared to 44%).
Accessing credit: Fewer small business owners in the current survey reported having difficulty obtaining credit than did so last quarter (23% compared to 27%).
When business owners were asked to identify the most important challenge facing their businesses, business owners once again said their top concern was finding new business (21%).
Other top concerns included the economy (11%), government regulations (11%), hiring (8%), and healthcare (8%).
Are these trends consistent with the outlook of small business owners in your community?