PNC’s latest semi-annual survey of small and mid-sized businesses, which concluded Aug. 9, shows that business owner optimism about the outlook for their own business in the next six months has reached a 21-year high amid strong expectations for sales, profits and demand.
Despite PNC economists’ predictions for a shallow recession starting in early 2024, business leaders’ outlook about their own companies has risen sharply this fall, with over three-quarters (77%) feeling highly optimistic compared to 49% a year ago and 60% in the spring.
In addition, owners’ outlooks for the national, local and global economies have also improved significantly. Almost half (47%) are highly optimistic about the local economy, compared to 29% last fall. About a third (34%) are highly optimistic about the national economy compared to 22% a year ago.
Also, profit and demand expectations are higher with 55% expecting profits to rise (compared to 46% last fall) and 64% expecting an increase in demand in the next six months (compared to 57% a year ago). Expectations for sales are similar to the spring survey, with 62% expecting an increase. Nearly two-thirds (65%) attribute their greater optimism for their business to confidence in their ability to run it.
“While the large spike in optimism among these business owners is a surprise, it can be attributed in part to the resilience that they demonstrated during the challenging years they have faced since the pandemic began,” PNC Chief Economist Gus Faucher said. “Business owners who survived that demanding time are confident in their ability to run their businesses and focus on what they can control versus what they can’t.”
Hiring remains a challenge, however. Nine in 10 employers say they intend to hold steady on hiring with just 9% planning to increase their staffing and just 1% expecting layoffs. Among businesses looking to hire employees, one in three (35%) say it’s become harder to hire qualified employees over the past six…
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