More Small Business Owners See Economy Getting Better
Vacation Poll: Can Small Business Owners Afford Time Off?
Better Economic Outlook May Be Inspiring More Vacation Plans
RIVERWOODS, Ill.--(
BUSINESS WIRE)--Small business owners’ confidence increased for the second straight month in May, rising to its highest level in seven months, according to the Discover
®Small Business Watch
SM. The index rose to 87.4 from 85.1 in April, driven in part by more small business owners believing the economy is improving.
“By their responses, small business owners are seeing improvement in the economy in spite of bad news.”
“This boost could be significant because we were polling following the week in which the Greek banking crisis reverberated through Europe, the gulf oil spill intensified and the Dow Jones plunged below 10,000,” said Ryan Scully, director of Discover’s business credit card. “By their responses, small business owners are seeing improvement in the economy in spite of bad news.”
In May, 35 percent of small businesses surveyed said they believe the economy is getting better, up from 31 percent in April; 51 percent say the economy is getting worse, down a point from the previous month; and 12 percent see the economy as the same, down from 14 percent in April.
The percentage of small business owners rating the current economy as good or excellent was 12 percent in May, compared to 13 percent in April. The April and May ratings on the current state of the economy are the highest since June 2008. Thirty-two percent rate the economy as fair in May, while 56 percent still think it’s poor.
Other May Confidence Indicators:
- Small businesses reporting cash flow issues held steady at 45 percent, the lowest number in seven months. Forty-eight percent reported no cash flow issues, and 7 percent were unsure.
- 28 percent of small business owners say economic conditions for their businesses are getting better, down from 30 percent in April; 44 percent said conditions are getting worse in May, down from 48 percent in April; and 24 percent said things are staying the same, up from 19 percent in April.
- 25 percent of small business owners indicated they were increasing business spending in May, up from 23 percent in April, while 46 percent said they were reducing spending this month, compared with 43 percent in April, and 31 percent said they are spending the same, up from 25 percent in May.
More Small Business Owners May Find Time for a Break
Although the recession forced more than half of small business owners to postpone or cancel their vacations during the past two years, a few more are considering some time off this year: 51 percent of small business owners said in May that the economy forced them to cancel or postpone vacations or time off, down from 58 percent last year, while 40 percent they had not changed plans because of the economy, up from 38 percent last year.
Small business owners also appear to have cut back on the amount of time they spend on the job: 56 percent of small business owners reported in May that they work six or more days a week, down from 61 percent last year. Prior to the recession, 45 percent of business owners said they worked six- and seven-day work weeks.
Fifty-five percent of small business owners say it has been two or more years since their last week-long vacation.
More Time-Related Findings:
- Non-self-employed people aren’t as affected by the economy when it comes to the recession: 44 percent of them reported they will delay or cancel a vacation this year, compared with small business owners at 51 percent.
- For small business owners who are postponing or canceling vacations due to the economy, 78 percent indicated they are doing so to save money or pay business-related bills.
- Small business owners continue to work longer hours per day than they did pre-recession. This year, 38 percent reported working 10 or more hours per day, compared to employees, which is statistically steady with 2009, when 39 percent reported doing so. These numbers are significantly higher than in 2008, when only 30 percent reported doing so. Only 19 percent of the general population in 2010 reported working ten or more hours per day.
- Small business owners are still working through the holidays far more than most people. This year, 55 percent say they will work through most, if not all, holidays, slightly down from 57 percent in 2009, but higher than the 47 percent that reported doing so in 2008. The number still outpaces non-self-employed people significantly, with only 27 percent of them saying this year that they will work through most or all holidays.
The views and opinions expressed by small business owners and consumers who participate in the Small Business Watch survey are their own and do not necessarily reflect those of Discover Financial Services or its affiliates. About the Small Business Watch
The Discover Small Business Watch is a monthly index measuring the relative economic confidence of U.S. small business owners who have less than five employees, a segment that consists of 22 million businesses producing more than a trillion dollars in annual receipts. The Watch is based on a
national random survey of 750 small business owners. It is commissioned by Discover Business card, which strives to offer the best business credit card for American small businesses, and is conducted by Rasmussen Reports, LLC (
www.rasmussenreports.com), an independent survey research firm. The numeric index is calculated by assigning values to responses to a set of six consistent questions. The base value of the Watch was established at 100.0 based on surveys conducted in August 2006. In addition to generating the index, the Small Business Watch surveys small business owners every month on key issues, and polls 3,000 consumers four times per year to gauge purchasing behavior and attitudes towards small businesses. For past results and survey data, visit
www.discovercard.com/business/watch. For information on Discover Business card, visit
www.discovercard.com/business.
About Discover
Discover Financial Services (NYSE: DFS) is a direct banking and payment services company with one of the most recognized brands in U.S. financial services. Since its inception in 1986, the company has become one of the largest card issuers in the United States. The company operates the
Discover card, America's cash rewards pioneer, and offers personal and student loans, online savings accounts, certificates of deposit and money market accounts through its
Discover Bank subsidiary. Its payment businesses consist of Discover Network, with millions of merchant and cash access locations; PULSE, one of the nation's leading ATM/debit networks; and Diners Club International, a global payments network with acceptance in more than 185 countries and territories. For more information, visit
www.discoverfinancial.com.
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