Nearly Half Expect Worse Holiday Quarter Than ‘08
REAL ESTATE: Only 6% of Small Business Owners Are Having Mortgage
HEALTHCARE DEBATE: Should Everybody Have to
RIVERWOODS, Ill.--(BUSINESS WIRE)--Sep. 28, 2009--
American small business owners tempered their economic outlook this
month, remaining cautious about perceived improvements in the economy.
After three consecutive months of gains, the latest Discover®
Small Business WatchSM
index fell to 87.7 in September, down 2.1 points from August.
“Although slightly lower this month, small business confidence has been
on a gradual climb since May, so this looks more like a pause than a
reversal,” said Ryan Scully, director of Discover's business
credit card. “A lot of people are eager for a definitive signal that
the economy is on the mend, but America’s small business owners aren’t
sending that message yet.”
When asked whether they agree or disagree that the recession is over for
their businesses, 69 percent of small business owners disagreed, only 13
percent agreed and another 18 percent couldn’t be sure.
50 percent of small business owners say they plan to decrease spending
on business development activities such as advertising, inventory and
capital expenditures, a jump from 43 percent in August. Similarly,
those who plan to increase spending fell to 25 percent from 27 percent
in August, and 22 percent are planning no changes.
53 percent of small business owners rate the economy as poor, up from
48 percent in August; 36 percent rate it as fair and 10 percent say it
is excellent or good.
46 percent of small business owners think the economy is getting
worse, up from 43 percent in August but still down considerably from
73 percent one year ago. This month 33 percent of owners say the
economy is getting better, down from 38 percent in August; 18 percent
say it’s the same, up from 15 percent in August; and 3 percent aren’t
46 percent of owners say they have experienced cash flow issues in the
past 90 days, down from 51 percent in August and 53 percent in July.
The perception of their own economic conditions remained relatively
flat: 29 percent of small business owners see economic conditions for
their businesses improving, down one percentage point from August,
while 45 percent see their own conditions getting worse, up one
percentage point over last month. The number of those who said things
are the same went down to 22 percent in September from 23 percent in
Outlook Darker for Remainder of 2009
Nearly half of small business owners, 46 percent, are expecting that
their final quarter of 2009 will be worse than their 2008 fourth
quarter, with 21 percent expecting year-over-year improvement, and 30
percent expecting the same results.
Real Estate: Most Owners, Consumers Staying Ahead of Mortgage Payments
Of the 87 percent of small business owners who say they own a home, only
6 percent reported being in foreclosure or behind on their mortgage
payments. That matches the trend among consumers. This month, the Watch
also polled 3,000 consumers this month to find that only 5 percent of
homeowners reported problems with their mortgages.
Health Debate: Should Everyone Pay?
Sixty-five percent of small business owners say it is difficult or
somewhat difficult to obtain affordable healthcare and another 21
percent said it was not very, or not at all difficult; 15 percent
When it comes to who should ultimately pay for health insurance, a
majority of small business owners and Americans, in general, agree that
individuals who can afford to pay for health insurance should be
required to do so: 56 percent of small business owners and 55 percent of
consumers say that Americans with the means should contribute to paying
for their own healthcare. Twenty-nine percent of both groups disagreed
and about 15 percent weren’t sure.
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 have 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 750 small business owners. It is commissioned by
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 2006. In addition to generating the index, the Small
Business Watch surveys small business owners every month on key issues,
and polls 3,000 consumers four times per year to gauge purchasing
behavior and attitudes towards small businesses. For past results and
survey data, visit www.discovercard.com/business/watch.
For information on Discover Business card, visit www.discovercard.com/business.
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. Since its inception in 1986, the
company has become one of the largest card issuers in the United States.
The company operates the Discover card, America's cash rewards pioneer,
and offers student and personal loans, as well as savings products such
as certificates of deposit and money market accounts. Its payments
businesses consist of 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.
Source: Discover Financial Services
Discover Financial Services
Robinson Lerer & Montgomery