Terry Corbell, The Biz Coach
By Terry Corbell
Business Consultant

Small Business Will Continue Cuts in Spending, Hiring – Wells Fargo/Gallup



By double-digits, small-business owners have been retreating on their spending and hiring, and will continue to retrench, according to the Wells Fargo/Gallup Small Business Index.

The November 2012 research clearly shows many small-business owners are pessimistic. Such conclusions have also been drawn by National Federation of Independent business, which reported small businesspeople are depressed by their prospects.

The Wells Fargo/Gallup report also reports such economizing is a reflection of the times. Ordinarily, such pessimism fades in a short amount of time. But the study shows small businesses have cut back multiple times since the Great Recession.

Worse, the trend will continue.

Wells Fargo/Gallup Small Business Index -- Net Capital Spending Intentions, Next 12 Months

The study indicates small-business owners are the most apprehensive they’ve been since W3 2010. Twenty percent will increase their capital spending, which is worse since July 2012. Thirty-four percent will cut back, also an increasingly bad indicator. Forty-five percent anticipate no change.

Wells Fargo/Gallup Small Business Index -- Net Capital Spending Intentions, Next 12 Months

Net capital spending was down in 2012.

Wells Fargo/Gallup Small Business Index -- Net Capital Spending, Past 12 Months

The small businesses that expect to increase spending, the 18 percent, is almost identical to 2011. The 40 percent that spent less in 2012 is similar to 2011 when 43 percent cut back.

Wells Fargo/Gallup Small Business Index -- Net Capital Spending, Past 12 Months

Finally, the study concludes small businesses probably hope to make large capital expenditures when the economy improves.

Unfortunately, from my observations in articles about public policy and the astute economic analyses by a noted economist, don’t count on improvement any time soon.

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Author Terry Corbell has written innumerable online business-enhancement articles, and is a business-performance consultant and profit professional. Click here to see his management services. For a complimentary chat about your business situation or to schedule him as a speaker, consultant or author, please contact Terry. 

Seattle business consultant Terry Corbell provides high-performance management services and strategies.