As we’re approaching the end of the year and we’re starting to enjoy the end of the holiday season, the question remains: Are we in an actual recession? With the information we continue to get about the economy, it’s hard to say. It seems inflation in one moment is up, and its rate is slowing down in another. Regardless small business owners’ answers have shifted from what they were saying three months ago.
Last quarter, 57% of small businesses said that they felt that a recession was already happening, with another 14% thinking it would happen by the end of the year. However, with the most recent CNBC|SurveyMonkey Small Business Survey[1], those numbers have become a bit more favorable, with 49% stating we’re in a recession and only 9% believe it will happen by year-end.
This sentiment is coming from the fact that the typical signs of the economy going down hasn’t come to fruition, and that’s why Main Street believes the recession is simply on hold for the moment. While the year is almost up, 39% state that the economy will still go into recession in 2023, which is higher than the 26% from the previous quarter. Most of those surveyed believe it will happen within the first six months of 2023.
When going beyond small businesses and asking the overall public, they have similar thoughts about whether the U.S. is in a recession or will be soon. Yet currently, the trend has gone down, with about 47% of respondents saying a recession will still happen by the end of 2022. This is 11% down from the previous quarter when adults were surveyed.
The sample size for this survey was 11,000 individuals and just over 2,500 small business owners. The poll itself occurred between November 9th through the 16th and is the first poll that shows recession fears to be alleviated.
It’s difficult to easily compare similar polls due to how the questioning is asked, as it can produce different results. With that in mind, though, there are still some similar mindsets across all the various polls, where all of them state that in Q3, we were in some type of recession. Whether it’s a USA Today Poll in July[2], an NPR poll in September[3], or an NBC News poll back in August[4], all of them had higher percentages ranging from half of those surveyed up to nearly 70% of those polled, assuming we’re in a recession.
The perception of a recession is fueled by partisanship
Even so, the downward trend is something to take note of especially given how tight the timeframe is; it could also be tied to recent political and economic items.
It seemed that in both Q3 and Q4, Republican small business owners appeared twice as likely as Democrats to state that we are in a recession. 31% of democrats believe “we’re currently in a recession,” while 58% of Republicans think the same. Back in Q3, when the same types of questions were asked, it was 34% of Democrats and 69% of Republicans. To
This helps show how the negative pushes are coming from partisanship about the current state of the economy. Part of these opinions could be due to the fact that during this same period of time, the price of gas fell and the President’s approval rating went up[5]. The midterm elections weren’t as much affected by economic items as socially related items.
Regardless – the small business segment is bracing itself
Nearly every small business survey thinks that the economic conditions are ‘excellent’ (only 3%). On the other hand, 80% think it’s only poor or fair, and this sentiment hasn’t really changed between either survey. So whether the recession has gone by, is on its way, or we’re in the middle of it, small business businesses are taking action to ensure they are prepared.
More than half (61%) surveyed mentioned they were ready for that recession to come. It wasn’t tied to any specific industry, company size, or type of business either, as everyone surveyed feels strong about their chances of survival.
Yet while the small businesses seem as if they’re ready, only 52% of Americans say they’re ready to handle the oncoming recession, personally. Less than half the women surveyed showed a sense of preparedness at 46%, with men feeling more confident at 59%. When it came to age, the younger adults felt more confident about them getting through a recession.
Regardless of the actual economic state, there seems to be a strong sentiment and determination to plow through the recession and come out on top. Small businesses feel as if they are more informed and thus more prepared to enact the right way forward, and suffer through the recession, only to come out on top and enjoy the growth that comes afterward.
