Latest Wells Fargo/Gallup Survey: Index falls to second lowest level since inception, yet majority of respondents say they’re satisfied being small business owners
“Small business optimism is eroding along with the economic and financial outlook,” said Dr. Scott Anderson, Wells Fargo senior economist. “The year began with an environment of inflation, rising unemployment, and reduced business activity. Stock prices plunged during the first two weeks of January, and many retailers reported sales below expectations. During the period the survey was conducted, the economic and financial conditions likely weighed on small business owner sentiment."
Despite the drop in overall optimism, survey respondents said they are satisfied being small business owners (90 percent). Satisfaction levels were almost unchanged from October. Eighty-five percent reported that if “they could do it all over again,” they would still become small business owners; in October, 83 percent reported the same.
Small business owners’ future expectations for the next 12 months fell 12 points to 45, the lowest score on record, and a 20-point drop from the survey’s highest score of 65 in December 2006. Small business owners’ ratings of their current situation decreased four points from 42 in October to 38, the third lowest score on record. Each of the six key measures in the Index score reflected a drop from the previous quarter.
About the Small Business Index
For the last 19 quarters, the Wells Fargo/Gallup Small Business Index has surveyed small business owners on their current and future perceptions of their business environment relating to their business financial situation. The Index consists of two dimensions: 1) Owners’ rating of the current situation of their businesses and, 2) Owners’ rating of how they expect their businesses to perform over the next 12 months. An Index score of zero reflects that an equal number of small business owners are optimistic and pessimistic about their companies’ situation. Results are based on telephone interviews with 600 small business owners nationwide conducted January 15- January 30, 2008. The margin of sampling error is ± 4 percentage points.
About the Gallup Organization
For more than 60 years, the Gallup Organization has been a recognized leader in the measurement and analysis of people’s attitudes, opinions and behavior. While best known for the Gallup Poll, founded in 1935, Gallup’s current activities consist largely of providing marketing and management research, advisory services and education to the world’s largest corporations and institutions.
About Wells Fargo
Wells Fargo & Company is a diversified financial services company with $575 billion in assets, providing banking, insurance, investments, mortgage and consumer finance through almost 6,000 stores and the internet (wellsfargo.com) across North America and internationally. Wells Fargo Bank, N.A. is the only bank in the U.S., and one of only two banks worldwide, to have the highest credit rating from both Moody’s Investors Service, “Aaa,” and Standard & Poor’s Ratings Services, “AAA."
Wells Fargo is America’s #1 small business lender in total dollar volume according to the most recent Community Reinvestment Act data (2006) and the #1 SBA 7a bank lender in total dollar volume. Wells Fargo has loaned close to $35 billion to women, African American, Latino and Asian business owners since 1995. For more information, speak with a Wells Fargo banker, visit wellsfargo.com/biz or call the National Business Banking Center at 1-800-CALL-WELLS.
Note to Editors: Survey results available upon request.