New Poll: Inflation Concerns Reach Peak, Threat of Banking Instability Troubling Small Business Owners
Washington, D.C. (June 13, 2023) – Today, the Job Creators Network Foundation (JCNF) released its May edition of the Small Business IQ Poll of 400 small business owners. The Small Business Intelligence Quotient (SBIQ), an index tracking overall sentiment about the economy, increased slightly by 0.1 points to 54.9. The margin of error is +/- 4.9 percent.
Elevated inflation is a notable factor weighing on the minds of small business owners. Concern among respondents about rising prices reached a record high in May, following the poll’s launch two years ago. The data suggests that while the mainstream media has largely moved on from covering the topic, small business job creators are left struggling.
Moreover, 57 percent of entrepreneurs are worried that recent banking failures and instability will impact their small businesses. The chain of events involving Silicon Valley Bank, Signature Bank, and First Republic Bank—and the Biden administration’s reaction—triggered a movement of capital from community banks to mega financial institutions. JCNF polling finds 60 percent of small businesses are most likely to access loans through the small banks and credit unions that are being squeezed.
Other key findings include:
- 64 percent of small business owners are concerned economic conditions could force them to close.
- 66 percent of small business owners are “very” or “somewhat” concerned about rising interest rates compromising their ability to access lines of credit.
- 71 percent of small business owners are “very” or “somewhat” concerned about new banking regulations making it more expensive for financial institutions to provide loans.
- 68 percent of small business owners believe the production and sales of electric vehicles should depend on consumer demand and competition, rather than federal government policies pushing the product.
Elaine Parker, President of the Job Creators Network Foundation, released the following statement:
“While the plague of inflation has largely fallen out of the headlines, concern among small business owners about rising prices has hit a two-year peak. Now, pile on banking instability and the threat it poses to accessing credit, and the U.S. small business community is uneasy. To help support these entrepreneurs, Congress should pursue elements of JCN’s American Small Business Prosperity Plan—a policy blueprint that will supercharge Main Street. Passing the Prove It Act would be a good first step. The bill—introduced by Sen. Joni Ernst in May—would help address the federal regulatory burden strangling our country’s small business job creators.”