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Rebound favors Fortune 500s, not smalls

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in Small Business Tax

Economic confidence among owners of America’s smallest businesses (five or fewer employees) fell last month to its lowest level since February, as more owners cited serious concerns about cash flow, according to the Discover Small Business Watch survey of 750 microbusinesses.

Key stat: 52% of owners say they’ve experienced cash flow issues in the past 90 days. That’s up from 44% in October and 39% at the start of 2009.

This is more evidence that the small business economy is lagging behind Fortune 500s on the road to economic recovery.

“Fading confidence among small business owners could be tied to their low expectations for the holiday season,” said Ryan Scully, director of Discover’s business credit card. “However, we saw drops in optimism across the board, so it’s hardly just one factor causing the concern.”

Just over half (53%) of small business owners think the overall economy is getting worse. That’s up from 44% in October, but still significantly lower than the 69% of owners who felt that way in February 2009.

Only 11% of small business owners said they expect to reap increased sales this holiday season compared with last year.

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