A new survey from Bank of America finds that small business owners are more confident in their local economies than the national economy overall. And as they see growth in the local economy, they will grow their businesses.
The survey, of 1,300 small business owners, reveals that 42 percent of respondents are more confident in their local economy vs. 35 percent in the national economy. An even bigger percentage — 69 percent — say their local economy is important to the overall success of their business.
“Overall, we see an improvement of confidence among small business owners,” said Robb Hilson, Bank of America small business executive, during a conference call on Thursday about the survey. “Arizona, the Inland Empire, Las Vegas — there are still concerns there. But in spite of the challenges, there is growing optimism among small business owners.”
The doesn’t mean national issues are not affecting small business owners. Healthcare costs, corporate tax rates, oil and gas prices, and the housing market were all high on the list of concerns for small business owners.
Not to mention credit restrictions. Respondents were split on whether lending criteria should be more lenient or more strict: 46 percent said they should be more lenient, and 7 percent there should be no requirements. A combined total of 45 percent said requirements are appropriate as they are or that more restrictions are needed to protect owners from defaulting.
According to Bank of America, it has added nearly 1,000 small business bankers to branches across the country in order to increase lending to small businesses. So far this year, it has extended more than $1.7 billion in new credit to small business owners who have less than $20 million in revenue.
While the latest Thomson Reuters/PayNet Small Business Lending Index showed that lending to small businesses slipped in March, with small business owners pulling back on borrowing, BofA’s Hilson said he expects businesses to start spending on equipment and hiring.
“In spite of the challenges, there is growing optimism,” he said. “There are lingering questions on national leadership, taxes, but as the survey showed, business owners are more concerned about their local economy. And that’s where we are starting to see activity.”
The survey was conducted between March 17 and April 9.