Small business owners are hesitant to hire and make investments over the near-term, but remained optimistic regarding their future over the long-term, according to the latest report released by Bank of America Corp (NYSE:BAC) and CFI Group.
The finding of the Bank of America/CFI Group Small Business Forecast was based on a phone survey of 1,000 owners and managers of small businesses across the United States. The survey was conducted from July 11 to August 15, 2014.
Small business owners are cautious
The report found that small business owners are satisfied with their personal life, but they are cautious with short-term prospects for the economy (where to do business specifically of generally).
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Small business owners gave a 71 rating for their personal life satisfaction and 39 rating for the overall strength of the economy. In addition, the respondents rated the state of the economy and employment environment 47. They rated the financial environment 54.
Perception about the business environment
When asked about their perception about the current business environment, the researchers described the response of small business owners as “unenthusiastic.”
The report indicated that 52% of the respondents said the situation of the small businesses are “not well, but not bad” while only a minority said it was “poor” or “very poor.”
Forty-five percent (42%) of the respondents said it is “not easy but not especially difficult” to run a small business, and 34% said the current tax environment is “unfavorable.
Robb Hilson, small business executive at Bank of America Corp (NYSE:BAC) said, “Small business owners feel less inclined to invest and make hiring decisions right now, which is likely a product of an uneven economy.”
Hilson added that the “entrepreneurial spirit remains strong,” and “small businesses continue to bet on themselves and are confident in the long-term health and success of the businesses they’ve built.”
Business owners revenue growth expectations
The Bank of America/CFI Group Small Business Forecast also found that 61% of the respondents expected their revenues to grow by a significant margin. Two-third of business owners estimated a revenue growth of 10% or more over the next 12 months.
The report indicated that the majority of the business owners has no plans of hiring or expanding their investments over the next 12 months. They indicated their intention to accommodate new business with a combination of “elbow grease” and longer hours, which suggests that small businesses may not serve as an engine for employment growth in the near-term.
“The small business community remains a bit wary of overall economic conditions and is likely waiting to see what effects potential political and business climate changes will have in the coming months before deciding to expand,” according to Rodger Park, director of customer analytics at CFI Group.