Small Business Owners Are Feeling the Love

From MarketWatch:

DES MOINES, Iowa, Oct 13, 2015 (BUSINESS WIRE) — As election season fast approaches, American business owners with 10 to 500 employees are feeling more confident about the current and future state of the economy, according to new research from The Principal Financial Well-Being Index [SM] : Business Owners. This year, 45 percent of small business owners are optimistic about the economy, up from 26 percent in 2012.

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A staggering 92 percent of business owners rate the financial health of their business as growing or stable. Two-thirds added staff and roughly as many feel their financials have improved in the past year.
Small businesses are often regarded as the backbone of the U.S. economy, and are drivers of America’s well-being. They employ half of U.S. workers, represent 99.7 percent of all employers, and have generated 63 percent of new private-sector jobs (net) between 1993 and mid-2013. They also produce 16 times more patents per employee than large patenting firms [1] .

Small business owners not only believe in the current success of their businesses, but believe the economic climate will hold and allow for prosperity in the next year. Sixty-six percent believe their business financials will improve in the next 12 months, up from 55 percent in 2014. Forty-two percent plan to add staff in the next 12 months, 32 percent plan to add benefits and another one-third plan to increase wages.

However, of the 74 percent of business owners that report having surplus capital, more than three-quarters (77 percent) are not spending it. They most commonly cite saving for future growth, economic uncertainty and lessons from the economic crisis as their primary reason for not spending surplus capital.

“We are seeing a clear rise in financial confidence from small business owners,” said Amy Friedrich, senior vice president at the Principal Financial Group [®] . “When business owners are adding jobs, increasing wages and adding benefits, we know they’re feeling good about their business, which bodes well for economic growth.”

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