For small business owners, the recession continues

Cornwall lists several key elements needed for small businesses to get back on track. 

|
Kevin Wolf/AP Images for NFIB/File
Former Senator Blanche Lincoln, chair of Small Businesses for Sensible Regulations, speaks at forum sponsored by National Federation of Independent Business (NFIB) and Politico in this November 2011 file photo in Washington.

September was another month of low expectations and pessimism for the small-business community, with the NFIB Small Business Optimism Index losing 0.1 points and falling to 92.8. The recession-level reading was pulled down by a deterioration in labor market indicators, with job creation plans plunging 6 points, job openings falling one point and more firms reporting decreases in employment than those reporting increases in employment.

The survey shows that key elements that will be needed for small businesses to, once again, help pull us out of a recession are just not improving:

  • Capital spending is clearly in a “maintenance mode.”  Business owners are keeping things running and replacing things when absolutely necessary, but they are not rushing out to expand space and equipment.  The continue to be in a hunker down frame of mind, which is a good way to be for the foreseeable future.
  • Sales continue to be sluggish.  The source of cash we need to pull us out of a recession is not more access to debt.  That is absolutely the worst approach.  The  economy is fragile and small businesses are financially on the edge in many cases.  Debt issued to small businesses may feel good for a very short period of time as it might fix immediate cash flow concerns, but it only makes things worse if sales do not improve.  Debt payments increase the company’s overhead which makes operational cash flow even more strained.
  • Spending by consumers will only improve when their employment improves and their confidence in continued employment is strengthened.  Right now these things are nowhere in sight.
  • You've read  of  free articles. Subscribe to continue.
    Real news can be honest, hopeful, credible, constructive.
    What is the Monitor difference? Tackling the tough headlines – with humanity. Listening to sources – with respect. Seeing the story that others are missing by reporting what so often gets overlooked: the values that connect us. That’s Monitor reporting – news that changes how you see the world.

    Dear Reader,

    About a year ago, I happened upon this statement about the Monitor in the Harvard Business Review – under the charming heading of “do things that don’t interest you”:

    “Many things that end up” being meaningful, writes social scientist Joseph Grenny, “have come from conference workshops, articles, or online videos that began as a chore and ended with an insight. My work in Kenya, for example, was heavily influenced by a Christian Science Monitor article I had forced myself to read 10 years earlier. Sometimes, we call things ‘boring’ simply because they lie outside the box we are currently in.”

    If you were to come up with a punchline to a joke about the Monitor, that would probably be it. We’re seen as being global, fair, insightful, and perhaps a bit too earnest. We’re the bran muffin of journalism.

    But you know what? We change lives. And I’m going to argue that we change lives precisely because we force open that too-small box that most human beings think they live in.

    The Monitor is a peculiar little publication that’s hard for the world to figure out. We’re run by a church, but we’re not only for church members and we’re not about converting people. We’re known as being fair even as the world becomes as polarized as at any time since the newspaper’s founding in 1908.

    We have a mission beyond circulation, we want to bridge divides. We’re about kicking down the door of thought everywhere and saying, “You are bigger and more capable than you realize. And we can prove it.”

    If you’re looking for bran muffin journalism, you can subscribe to the Monitor for $15. You’ll get the Monitor Weekly magazine, the Monitor Daily email, and unlimited access to CSMonitor.com.

    QR Code to For small business owners, the recession continues
    Read this article in
    https://www.csmonitor.com/Business/The-Entrepreneurial-Mind/2012/1009/For-small-business-owners-the-recession-continues
    QR Code to Subscription page
    Start your subscription today
    https://www.csmonitor.com/subscribe