Discover® Small Business WatchSM: Small Business Economic Confidence Continues to Slide
27 Ottobre 2008 - 9:57AM
Business Wire
The Discover� Small Business WatchSM dropped for the second
straight month as news of a congressional rescue plan failed to
lift the spirits or expectations of the nation�s 22 million small
business owners. The index slipped 3.2 points in October to 71.4,
the lowest confidence rating since the Watch was established in
August 2006. �Faced with a barrage of bad news about financial
markets and the economy, small business owners continue to tell us
that there is no end in sight to this economic crisis. For the
first time, we saw more than 60 percent rate the economy as poor,�
said Ryan Scully, director of Discover's business credit card.
�Most of their plans to invest in their businesses have been on
hold for some time.� October Key Findings: 64 percent rate the
economy as poor, up from 57 percent in September and the highest
rating in this category in the history of the Watch; 8 percent rate
the economy excellent or good. 53 percent believe economic
conditions for their businesses are getting worse, up from 51
percent in September and equaling the all-time high in the history
of the Watch The number of small business owners who think the U.S.
economy is getting worse rose one point to 74 percent in October; 9
percent feel the economy is getting better, up slightly from last
month�s record low 7 percent. 38 percent of small business owners
say they have experienced cash flow issues over the last 90 days,
down from 42 percent in September. 23 percent plan to increase
spending on business development over the next six months, down
from 28 percent in September and equaling an all-time low in the
Watch; 42 percent plan to decrease spending compared to 44 percent
last month; and 33 percent anticipate making no changes, up from 26
percent in September. Economic Crisis: More than Half of Small
Business Owners Disagree with Bailout Fifty-seven percent of small
business owners say they disagree with the $700 billion economic
rescue plan that was approved by the Congress and signed by the
president earlier this month. �As we have seen in previous Watch
surveys, events on Wall Street do not necessarily reflect the
reality for small businesses. That may be one reason so many don�t
see this rescue plan as bringing much benefit to their business,�
Scully said. �They seem to have little faith that the government
knows how to answer the needs of America�s small business owners.�
Other Economy Poll Highlights: 69 percent of small business owners
are not confident that the federal government and Congress can
address their business needs. When asked how the rescue package may
affect their business, 53 percent said they do not expect it will
have any impact. Only 16 percent think the package will help their
business, while 18 percent believe it will hurt. 56 percent of
small business owners say that they do not believe that government
action can help the economy enough to benefit their business. 77
percent say that economic conditions have not forced them to borrow
money to pay their bills. Among those who are seeking loans, 70
percent say it is harder to borrow money right now. �Small business
owners are showing resiliency,� Scully said. �Most are not
borrowing, but they are taking a hit on their income: 55 percent
are taking home less money this month.� Election Poll: Small
Business Owners Not Getting Heard; Economy Remains Top Concern
Small business owners continue to believe their issues are not
being addressed in the presidential election. Only 19 percent think
that this election season has created a forum for them to heard by
the candidates. As it has throughout this election year, the
economy remains the biggest issue for small business owners. In
all, 47 percent cited the economy as their No. 1 election concern,
down slightly from 52 percent in September. The issue of government
ethics and corruption rose to 15 percent in October, up from 9
percent in September; followed by national security at 11 percent;
the war in Iraq at 10 percent; healthcare at 6 percent; and
immigration at 3 percent. 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 employ 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
1,000 small business owners. It is commissioned by the 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 of 2006. In addition to generating the index, the Small
Business Watch surveys small business viewpoints on key business
drivers, and also surveys 4,000 consumers to gauge purchasing
behavior and attitudes towards small businesses. For past results
and small business survey data, visit
www.discovercard.com/business/watch. For information on Discover
Business Card, visit www.discovercard.com/business. About Discover
Financial Services Discover Financial Services (NYSE: DFS) is a
leading credit card issuer and electronic payment services company
with one of the most recognized brands in U.S. financial services.
The company operates the Discover Card, America's cash rewards
pioneer. Since its inception in 1986, the company has become one of
the largest card issuers in the United States. Its payments
businesses consist of the 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 185 countries and territories.
For more information, visit www.discoverfinancial.com.
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