Despite some economic wins over the last year or so, Americans may not have the strongest confidence the government. A recent shutdown and rising interest rates have taken their toll on American pocketbooks and confidence.
The government shutdown resulted in about 800,000 government employees being furloughed, agencies such as the IRS and SBA mostly shutting down, and important services such as eVerify going out of business. This showed small business owners just how much the government can affect their bottom line and daily operations.
In light of these recent events, Nav surveyed 120 small business owners to get their opinion on the possibility of an impending recession. Here’s what we found.
Nav’s Small Business Recession Survey Data
Majority believe the U.S. economy is headed for a recession.
Of those surveyed
- 70.3% believe the country is headed for a recession.
- 48% think a recession will hit within six months to one year.
- 19% believe there will be a recession in 2020.
- 17% are not sure when a recession will hit.
When asked why they believe there will be a recession, they said the following:
- 25% because of the government shutdown.
- 23% cited higher interest rates
- 16% because of a slowdown in their small business.
- 14% said U.S. Trade Policies were to blame.
- 22% stated other reasons, including the actions of elected leadership.
How are business owners preparing for a recession?
Many of the business owners surveyed are already taking measures to prepare for a recession. Of those surveyed,
- 38% are cutting costs.
- 22% are pursuing financing options.
- 2% are reducing staff.
- 19% aren’t doing anything.
Small businesses are a sensitive and telling economic barometer, providing valuable insights into the true nature of the economy. While a recession may not come as soon as feared, the fear and caution is real and justified.