Fully 93% of small business owners are worried about the U.S. economy experiencing a recession in the next 12 months, a survey by Goldman Sachs. The poll of 1,533 Goldman Sachs 10,000 Small Business Voice participants was conducted by Babson College and David Binder Research from June 20-23, 2022.
In addition, 38% of respondents have seen a decline in customer demand as a result of inflationary price increases on goods and services.
The past several months have brought higher prices on just about everything. Consumer prices jumped 9.1% year over year in June, while wholesale prices shot up 11.3%.
Some 78% of small business owners said the economy has got worse in the past three months, with only 5% saying it had improved. Over the same period, 84% said hiring challenges had worsened and 80% said inflationary pressures had increased.
This quarterly survey is the first time the recession question has appeared. It found that 6% of respondents were not worried at all about a recession, while 1% said they did not know.
Supply chain issues got worse for 38% of respondents in the past three months, while 40% said such problems had stayed the same.
Among the “most worrisome data points” in the survey was that 38% of small businesses said they were seeing a decline in customer demand as a result of price increases on goods and services, said Joe Wall, who heads advocacy efforts for Goldman’s 10,000 Small Businesses training program.
Record inflation and ongoing supply chain challenges continue to have an outsized impact on small businesses as well.
Ninety-seven percent of small business owners today say that inflationary pressures on their business have increased or stayed the same compared to three months ago.
Sixty-five percent have had to increase the prices of their goods or services to offset the negative impact of broader economic trends and 38% have seen a decline in customer demand as a result of inflationary price increases.
Making matters worse, 80% say that higher gas prices are negatively impacting their business and 78% say supply chain issues have gotten worse or stayed the same compared to three months ago.
Despite these broader trends, however, nearly two-thirds (65%) of small business owners remain optimistic about the financial trajectory of their own business in 2022.
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