Majority of Small Businesses Have Positive Outlook, Finds Survey
A growing proportion of small businesses worldwide are bullish on the first half of 2010 and, for the first time since the financial crisis, many are signalling strong local economic growth and an increase in capital investment and recruitment plans. Still, business confidence among US small businesses surveyed trails the sentiment of small businesses in emerging markets.
The semi-annual HSBC Small Business Confidence Monitor gauges the six-month outlook of small businesses on local economic growth, capital investment plans and recruitment. This fifth wave of the survey is the largest to date, capturing the views of more than 6,000 small businesses across 20 markets. In addition to gauging the views of small businesses in Asia, the Middle East, Europe, and Latin America, the most recent Small Business Confidence Monitor also surveyed small businesses in the US for the first time. The results were used to calculate an index ranging from 0 to 200 where 200 represents the highest confidence level, 0 represents the lowest, and 100, neutral.
Mark Luppi, executive vice president and head of business banking for HSBC – North America, said: “The small business sector is a key indicator of the overall health and competitiveness of local economies and our Small Business Confidence Monitor allows us to gauge the sentiment of this critical group. While the findings reveal that confidence levels are relatively positive in the US, they do lag behind the levels seen in the emerging markets surveyed. The news overall is encouraging with the majority of US small businesses expecting capital expenditure and recruitment plans to remain relatively stable or increase slightly versus the reductions we have seen in the past.”
Globally, the small business indices tracked by HSBC in most countries and territories hold a positive outlook, with the Middle East at 125, Latin America at 118, Canada at 116, the US at 106, and the UK at 101. France is just below neutral at 94. But emerging markets’ small businesses in Asia, the Middle East, Latin America, and Eastern Europe have a significantly higher level of business confidence than their counterparts in the developed markets with an index of 121 versus 106.
In summary, the HSBC Small Business Confidence Monitor found an overall positive outlook in terms of growth, capital expenditure and recruitment among US small businesses, but less immediate plans to conduct business internationally.