Small Business Outlook on Spending, Credit Highest in Years

The proportion of U.S. small-business owners who plan to increase capital spending over the next 12 months (28 percent) is the highest in four years, according to the Wells Fargo/Gallup Small Business Index.

And more small businesses report having done so in the past 12 months.

Twenty-four percent of small-business owners now say they have increased their capital spending – up from 19 percent in October 2011 and the highest level of such spending since April 2008, according to Wells Fargo/Gallup

Thirty-five percent of owners say they decreased their capital spending – down from 43 percent in October, and the lowest level since July 2008.

The latest Index readings are based on telephone interviews with 600 small-business owners, conducted Jan. 9-13, 2012.

Without access to credit, capital spending is virtually impossible for many small business. However, owners’ outlook on obtaining credit has also improved.

The proportion of business owners who feel it will be somewhat or very easy to get credit over the next 12 months (27 percent) is the highest since April 2009, and is up from 22 percent in October of last year.

While 38 percent still expect it to be somewhat or very difficult to get credit, this is down significantly from 43 percent in October.

One in three small-business owners continue to say it was somewhat or very difficult for their company to get credit over the past 12 months – about the same as in the last two quarters of 2011. However, 25 percent of owners say credit was somewhat or very easy to get over the past 12 months, the highest percentage since April 2009.

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