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Small biz outlook remains cautious

The economic confidence of American small business owners remains largely unchanged in October, rising less than 1 point from the previous month on the Discover  Small Business Watch index. The Watch rose from 87.7 in September to 88.5 in October, with only one key measurement – business investment – showing any significant change.

“Small business owners aren’t showing any new optimism in the economy,” said Ryan Scully, director of Discover’s business credit card. “Half of them think it will take more than 12 months before most people feel the economy has stabilized, and two out of three are expecting to dig into their own pockets to stay afloat.”

One of the only key measurements to show any significant change from September is the likelihood of investing in business development in the next six months in areas such as advertising and capital expenditures. On the positive side, the number of those who said they plan to decrease spending dropped from 50 percent in September to 44 percent in October. However, the number of those planning no changes jumped from 22 percent to 32 percent. Those who are planning to increase spending dropped from 25 percent to 23 percent.

“This could indicate that any significant expansion and investment in the small business sector isn’t likely to arrive for quite a while,” Scully said. “They’re holding on to their money.”discover1

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