Small business owners appear more optimistic about the prospects of their own companies, but they remain skeptical about the overall economy, according to a survey released this week by Union Bank. High unemployment, weak consumer demand and tepid access to credit are among some of the top concerns facing the sector.
This sentiment is reflected in a number of recent reports. Earlier this week, Gallup released a survey showing a mere 27 percent of small business owners expect to have an easier time finding a traditional small business loan over the next year, compared to 38 percent of respondents who expect such credit conditions to worsen.
While this trend has put a damper on many entrepreneurs' hiring and expansion efforts, it has driven many savvy owners to seek out alternative lending sources.
The Union Bank report also found some 48 percent of surveyed small business owners feel the climate for their company has deteriorated over the past two years. However, an equal number of respondents expect an improved climate within the next two years.
"This survey demonstrates the strength and resolve of those at the helm of small business across the nation who, despite the lack of confidence in the direction of the overall economy, are confident in their own ability to chart a positive course for their business," said Union Bank executive vice president Todd Hollander. "These entrepreneurs have become experts at navigating through challenging economic times, and it makes sense that they're moving forward with cautious optimism."
Despite their resilience, some small business owners appear to be relying on government assistance in financing their operations. Of those who applied for and received a business loan in 2011, nearly one-third – 32 percent – were backed by government guarantees.