From CNBC:

U.S. President Biden addresses small business optimism at a White House event to mark National Small Business Week. A new poll by Goldman Sachs finds 75% of small business owners are optimistic about their financial trajectory in 2024, up from 68% a year earlier. 28% of respondents rated the economy as good or excellent, up 9% from the previous quarter.

Small business owners are facing persistent inflation and lending concerns but are more optimistic. More than half of small business owners surveyed expect to create jobs this year, and 62% anticipate profits will increase. This data aligns with recent indicators showing consumer and business confidence in the economy.

Jill Bommarito, CEO of Ethel’s Baking Company, sees growth opportunities despite challenges, citing an easing of supply-chain issues and inflation. However, the demand for real, authentic brands and services remains strong. The survey also revealed that 35% of respondents found 2023 as challenging as the peak of the pandemic in 2020.

Inflation is still a major concern for business owners, even as the rate of price increases falls. Rising prices have overtaken labor woes and regulations as the top concern for small businesses. The economic optimism could be due to expected rate cuts from the Federal Reserve in the coming year.

Main Street small business owners are focused on the lending environment amid high interest rates. About 77% of respondents are concerned about their ability to access capital, with 86% saying their growth forecast will take a hit if it continues to get harder to access capital. Goldman Sachs has come out against the Basel III Endgame proposal, which will increase capital holding requirements for larger and regional banks.

Access to working capital is a top issue for small business owners in 2024. Nearly 80% of those who applied for a loan in the last year found it difficult to access affordable capital, and 28% of those who applied for loans received payment terms they considered to be predatory. Interest rates paid on short-term loans hit 9.8% in December, up from 7.6% in January 2023.

Bommarito highlights the importance of small businesses and the challenges they face, emphasizing their role as the foundation of the economy. Small businesses are considered the riskier bet when it comes to accessing affordable capital.



Read more: Small business optimism rises despite inflation: Goldman Sachs survey