PNC Spring Economic Outlook Survey

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PNC Survey Shows Business Owner Optimism Continues to Soar Amid Improving Economic Conditions

PNC’s latest semi-annual survey of small and mid-sized businesses, which concluded Feb. 1, shows that business owner optimism about economic conditions over the next six months has reached a 22-year high amid lessening fears of a recession.


Optimism At New Heights: A majority of those surveyed (55%) are highly optimistic about the national economy, rocketing from 34% last fall and 26% a year ago. Four in 10 (40%) are highly optimistic about the global economy, up from 25% last fall and 9% a year ago. Eight in 10 business owners (79%) report that they are highly optimistic about the prospects for their own business, consistent with last fall (77%) and up substantially from a year ago (60%).

Inflation Concerns Lessen: Based on the survey results, inflation pressures appear to be lessening. Fewer than half (47%) of businesses expect to increase prices in the next six months, down from last fall (55%). Of those expecting to take that step, just over one in 10 (12%) plan to raise them by 5% or more, a drop from last fall (25%) and a year ago (23%); four in 10 (41%) expect a smaller increase of 1-2%, up from last fall (19%) and last spring (32%). 

Hiring Hints: Related to employment, two in 10 (21%) business owners expect to increase their full-time workforce in the next six months, up from 9% last fall and 13% a year ago. Three-quarters (74%) expect the number of full-time employees to remain the same, while only a small number (4%) anticipate reductions. Among businesses looking to hire employees, a quarter (25%) say it’s become harder to hire qualified employees, down from last fall (35%) and a year ago (36%).


Fraud and Cyber Concerns: Two-thirds (66%) of business owners are moderately or extremely concerned about either the risk of fraud (59%) or potential cyber security breaches (58%).

Profit Expectations: The outlook on profits for the next six months remains steady, with just over half of those surveyed (52%) expecting an increase, midway between the levels recorded last fall (55%) and a year ago (49%). Few businesses anticipate decreases in profits (5%) or sales (5%) over the same time period. 

Need for Financing: Nearly two in 10 (18%) owners expect their business’ need for financing will increase in the next six months, up from 7% last fall and 9% a year ago. Among businesses expecting their need for financing to increase, fewer than three in 10 (28%) say they will definitely or probably request a new loan or line of credit during that period. This suggests that a significant majority are likely to tap sources other than new loans/lines of credit to meet their upcoming financing needs.


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