April 22, 2019
By Mary Miller
Contributing Editor, Main Street Monday
Main Street Monday — Recession Rumors Gaining Momentum
For the last few months, it’s been a wild ride for Main Street. According to the latest CNBC/SurveyMonkey Small Business Survey, it reflects about 53% of small business owners fear a recession is ahead.
Due to decreased optimism levels, loss of revenue and the backlog in processing SBA loans due to the government shutdown, small business owners are proceeding with caution relative to predicted business outlooks in 2019.
Despite rumblings of a potential recession, with index numbers only slightly down from the record numbers in Q3 2018, the overall, long-term outlook remains optimistic.
Stats from the Q1 2019 CNBC/SurveyMonkey Small Business Survey:
- 52% of small business owners described business conditions as good, down from 55% in Q4 2018 and 58% in Q3 2018.
- 57% expected an increase in revenue, down from 58% in Q4 2018 and 62% in Q3 2018.
- 28% planned to increase full-time staff, down from 29% in Q4 2018 and 33% in Q3 2018
Overall small business confidence index levels:
- Q1 2019 58
- Q4 2018 59
- Q3 2018 62
While recent government uncertainty has caused confidence levels to dip, only 20% of small business owners indicated it was a major concern for their businesses.
With the majority of components holding steady, talk of a recession is premature, according to former Pimco CEO and now Allianz chief economic advisor Mohamed El-Erian. El-Erian warns of the dangers of “talking ourselves into a recession,” and instead encourages more focus on the positives. Those positives include a strong labor market, in addition to an increase in wages, business investment and government spending.