Small Businesses Are Less Optimistic but May Still Need Additional Credit


During the third quarter of 2015, small businesses and middle market companies appear to be less optimistic as the year comes to a close and many are in the midst of budget planning.

However, many metrics still remain elevated from years prior. Likewise, demand for additional credit among the small business market remained at a positive from diminished demand seen in early 2014. The third quarter 2015 Economic Pulse Survey explores business confidence, credit appetite and expectations for retirement.

“Increased investments in capital expenditures and a spike in the percentage of small businesses that switched primary banks is indicative of a small businesses market that may be willing to change banks for a stronger credit relationship,” said Ray Johns, Managing Partner, Barlow Research.

Appetite for additional credit remained elevated in the small business market and returned to normalcy in the middle market (which fell to the lowest level since 2010 in the second quarter of 2015). Few small businesses have financed their business operations with commercial banks, a decrease of 8% since the previous quarter. The strongest credit markets appear to be in the transportation, communication and utilities industry and the manufacturing industry.

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