Based on the results of PNC’s latest semi-annual survey of small and mid-sized businesses, which concluded Feb. 6, it appears that resilient business owners are defying predictions of an economic downturn later this year. In fact, business owner optimism about the outlook for their own businesses in the next six months has reached a 20-year survey high.
Six in 10 business leaders feel highly optimistic about the prospects for their own company despite remaining cautious about the national and their local economies. The gap between optimism for their company versus the broader U.S. economy is now at a survey high of 34 percentage points, nearly double the historic survey average (18 percentage points).
The survey, now in its 21st year, also revealed that leaders are expecting a better overall business environment with nearly two-thirds (63%) expressing belief that business conditions in the U.S. will improve in the next six months and a majority (58%) expecting to see sales increases in the same timeframe.
“Although we expect the Federal Reserve to continue to raise interest rates in the spring of 2023 and economic growth is slowing, businesses remain optimistic about their own near-term prospects. In particular, business owners are finding that strong market conditions are prompting decisions to raise prices for the goods and services they offer,” said Gus Faucher, chief economist of The PNC Financial Services Group.
Business owners also see an easing in pricing pressures. Fewer businesses than in the last three waves of the semi-annual survey report that they plan to increase their own prices to customers by 5% or more in the next six months. In addition, fewer than half (47%) anticipate supplier prices to increase in the next six months, down from over half (53%) last fall and returning to a level similar to a year ago (46%). Fewer businesses (21%) expect consumer price increases of 5% or more in the U.S. economy, overall, compared to last fall…
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