The haunting specter of economic uncertainty looms large for small businesses this Halloween week as employers grapple with a trifecta of spine-chilling challenges: surging interest rates, rising inflation, and the ongoing struggle to secure talent in a competitive labor market.
In a soon-to-be-released survey among 65,000 small businesses conducted October 25-30, small business owners indicated they’re putting a halt on new hiring.
That’s because 56% of these businesses are pessimistic or worried about their business future. That’s up 86% from our first survey in July.
In the September survey, 85% of employers now predict a difficult recession. That’s up 25% from the month prior.
“The challenges small businesses face with interest rates, inflation, and talent acquisition are the real ghost stories that are frightening these employers,” Andrew Crapuchettes, RedBalloon CEO, said.
“Small businesses are the backbone of the economy, and they're hunkering down for a difficult recession. It's time for policymakers to recognize the real horror these businesses are experiencing and work towards solutions that will light the way through these dark times.”
Furthermore, 75.3% of those surveyed in September expressed the belief that "higher for longer" interest rates will "hurt my business," while a significant 70.3% reported their personal financial situation as "much worse" since the inauguration of the Biden administration.
For many business owners, this upcoming holiday season was already looking like the ‘nightmare before Christmas’, but ‘spooky season’ for the economy may be arriving ironically on time this year according to the latest FEI data.
If this economic seasonal depression is to be avoided and a happy New Year ushered in, the government needs to listen to small business owners’ voices and find a solution.
Read the full results of the September FEI here.
The September 2023 Freedom Economy Index, also a collaborative effort between PublicSq. and RedBalloon, surveyed more than 60,000 small businesses, with 1,126 respondents and a 3% margin of error at the 95% confidence level. Download the full September report here.