Small business owners remain cautious about the coming year even as they feel their concerns remain unaddressed in the midst of a presidential election, according to the latest results of a quarterly survey.
The Wells Fargo/Gallup Small Business Index retreated three points to 64 for the second quarter, matching the level a year ago.
“During this presidential election year, the latest Wells Fargo/Gallup Small Business Index shows the outlook of business owners has not changed significantly in the last year, both in their current situation and future outlook,” said Lisa Stevens, head of small business for Wells Fargo. “While small business optimism over the past year has been higher than at any point since 2008, many business owners remain cautious about today’s economy and the year ahead.”
While 87 percent of owners responding to the survey upon which the second quarter index was based said they’re following the 2016 presidential election, 50 percent said they expect the outcome to affect their operations. But only 28 percent of owners said candidates are discussing issues important to small businesses. Those issues include the implications of taxes on their operations, economic policies affecting small businesses and health care laws, the owners said.
Asked to identify the most pressing challenges facing their operations, 16 percent of owners said attracting customers and finding new business was their top concern. The economy and government regulation tied for the second most-cited challenges, followed closely by hiring and retaining quality staff.
The latest index is based on the results of telephone surveys of 600 small business owners conducted April 4 to 8.The overall score is based on the answers to 12 question about present conditions and expectations for the coming year. Readings above 0 indicate more optimistic than pessimistic responses.
For the second quarter of 2016, the score for the present situation fell two points to 24. The score for expectations slipped a point to 40.
Most index measures held steady or declined slightly from the first to the second quarters.
While 67 percent of business owners described their current financial situation as “good,” 55 percent reported that company cash flow was “good.”
Looking ahead, 51 percent of owners said they expect revenue to increase over the coming year, while 63 percent said they anticipate “good” cash flow. While 23 percent of owners said they anticipate an increase in jobs, 9 percent forecast a decrease.