Capital One’s latest Small Business Growth Index revealed that optimism among small business owners is the highest since the recession.
The biannual survey of 500 small business owners found that 67 percent think business conditions in their area are good or excellent, up from 60 percent a year ago.
“We’ve seen small business optimism continue to rise as business owners benefit from a strong economy,” Jenn Flynn, head of Small Business Bank at Capital One, said. “At the same time, small business owners still have concerns about taxes, tariffs and other areas of economic policy. As business leaders balance opportunity with risk, we remain committed to offering solutions designed to empower small businesses and fuel growth.”
The survey also found that male business owners are more optimistic than female business owners. Specifically, 69 percent of male small business owners say current economic conditions are good or excellent, while 64 percent of women small business owners believe conditions are good or excellent.
Optimism is primarily driven by business growth (65 percent), national economic conditions (54 percent) and improved business operations (51 percent). Further, 59 percent said the change in presidential leadership has been positive for small businesses. Also, 49 percent say the cost of health care is a top policy concern, followed by tax policies (43 percent) and economic growth (36 percent). Additionally, 33 percent of small businesses are concerned that new tariffs will have a negative impact on their business.
The survey also found that 33 percent of small business owners plan to hire in the next six months – up from 25 percent a year ago. The biggest factor impacting small business owners’ ability to hire is the skills gap (34 percent) followed by competition from other businesses (30 percent), financial resources (30 percent) and the tight labor market (28 percent).
Also, 20 percent of small business owners expect to pay less in taxes than earlier this year, when 36 percent thought they would pay less in taxes. Roughly half (52 percent) believe they will pay about the same in taxes, up from 41 percent in spring 2018.
“Concerns about hiring and tax reform are not only felt by leaders of large companies but small businesses as well. The Small Business Growth Index tells us that business owners are tackling challenges like hiring and retention with fewer resources than larger companies,” Brad Jiulianti, head of small business card at Capital One, said. “Despite these challenges, we are encouraged by the continued optimism among business owners, especially given the major role they play in our nation’s economy.”