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PNC survey shows small business owners remain optimistic despite fears of inflation, recession

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  • Nearly half (49%) of small business owners are very optimistic about the near-term prospects of their business.
  • Nearly two-thirds (63%) expect to increase prices within the next six months.
  • Nearly 7 in 10 (69%) expect a recession within the next 12 months.
  • Nearly half (47%) of companies relying on supply chains say it remains a problem.

Pittsburgh, September 8, 2022 /PRNewswire/ — Small business owners and executives are looking for near-term business I am optimistic about the future. According to his latest PNC semiannual economic outlook survey.

20th surveyth year and conclusion August 8, similar to the spring survey, nearly half (49%) feel very optimistic, business leaders still have high expectations of their companies, and the share of those who feel pessimistic It was shown to have risen from a relatively low 2% to 7%. .

Concerns about inflation and the impact of price increases on businesses are still on the minds of owners and operators. Nearly two-thirds (63%) of businesses are committed to continuing price increases, the highest number in the survey. More than a third (36%) of companies planning to raise prices expect him to raise consumer prices by more than 5% next year. one year ago.

The primary reason for price increases has changed from efforts to meet rising non-labor costs (38% vs. 63% last spring) to favorable market conditions (44% vs. 22% last spring). He is less than one in five (18%) pointing to rising labor costs. Pricing pressure on their business and rising supplier costs and capital expenditures are also factors.

In addition to raising the prices of their goods and services, 7 in 10 (69%) said they would do other things to combat rising inflation, such as improving efficiency, cutting costs and managing cash flow. Indicates that adjustments are being made.

In addition, business owners have expressed concern about an impending recession. Nearly seven in 10 (69%) fear a recession in the next 12 months.

“The survey shows that business owners believe that conditions remain robust despite concerns over high inflation. It shows that we are raising prices because we can, not because we can, which reflects continued strong demand across the economy, despite higher interest rates,” said PNC chief economist. Gus Forcher.

“There’s been a lot of discussion and debate about the possibility of a recession in the near term, and business owners are clearly considering this possibility,” Faucher said. “We think it’s low, but we think there’s a 45% higher chance of a recession over the next two years.”

Supply chain disruptions also continue to be a concern for business owners, with nearly half (47%) of companies relying on their supply chains affected. To address these issues, many companies are using a variety of strategies, including expanding their supplier base (33%) and stockpiling inventory (27%). Raising prices (20%), changing sales or delivery promises (17%), and establishing exclusive supplier relationships (14%) are some of the less common ways companies deal with supply chain disruptions and delays. I have. 3 out of 10 of his dependents on supply chain inventory are running out. Four in 10 expect their supply chain timeliness to improve over the next six months.

Other key findings include:

  • Relaxed Optimism: Prospects for the national and regional economies improved slightly over the spring, but remain lower than last fall. More than a fifth (22%) are very optimistic about their national economy, while 23% are pessimistic. More than half (54%) are moderately optimistic.
  • Addressing staff shortages: Fewer employers face staff shortages, but it remains a challenge for four in ten (41% compared to 61% last spring), and hiring remains a challenge for many. Businesses have found ways to adapt, such as shifting workloads. Half (49%) are experiencing overtime or increased workload for existing employees, and a third (33%) rely on owners or managers for staff time. A third report sourcing labor through alternative sources such as temporary workers or gig-her workers, and 10 more than two of her (22%) are new to coping. Increasing or adding technology or automation.
  • Rising Raise: 4 in 10 expect to increase employee compensation from 30% in the spring. Expectations for increased compensation are highest in manufacturing (53%), followed by services (39%), wholesale/retail (36%) and construction (35%).

Full national and regional survey results are available at pnc.mediaroom.com.

PNC Financial Services Group, Inc. (NYSE: PNC) is one of the largest and most diversified financial services institutions in the United States. usa, organized around customers and communities, enabling strong relationships and local delivery of retail and business banking, including a full range of lending products. Professional services for businesses and government agencies, including corporate banking, real estate finance and asset-based lending. Asset management and asset management. For more information on PNC, please visit www.pnc.com.

methodology

The PNC Economic Outlook survey July 5, 2022 to August 8, 2022with self-reported earnings of $100,000 To $250 million500 interviews were conducted nationwide. The sampling error for national results is +/- 4.4% at the 95% confidence level. The research was conducted by Artemis Strategy Group (www.ArtemisSG.com), a communications strategy research firm specializing in brand positioning and policy issues.company headquartered in washington dcprovides communications research and consulting to a variety of clients in the public and private sectors.

Disclaimer: This report has been prepared for general informational purposes only and is not intended to constitute specific advice or recommendations. Any reliance on this information is solely at your own risk. Note: Total percentages may not add to the total due to rounding.

contact:

Alan Aldinger
(412) 370-3887
[email protected]

Source PNC Financial Services Group, Inc.

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