Despite repeated assertions that the economy has moved out of the recession and is moving toward recovery, a major card brand's recent survey of small business owners finds pessimism still dominant.
Discover Financial Services, the parent company of the Discover Card brand, conducts monthly surveys of small business owners and publishes the Discover Small Business Watch index based on its findings. The company defines "small business" as any enterprises with fewer than five employees and surveys 750 owners of these enterprises for the index.
Discover reported that the index fell 12 points in November, to 76.5 from 88.5 in October.
"Fading confidence among small business owners could be tied to their low expectations for the upcoming holiday season, as 46% are forecasting decreased sales and 39% are expecting to hold the line," said Ryan Scully, director of Discover's business credit cards. "However, we saw drops in optimism across the board, so it's hardly just one factor causing the concern."
The only potential bright spot came in the brand's acknowledgment that some degree of downturn in outlook has been common among small business owners in previous Novembers.
The mood of small business owners generally has soured in November for three straight years, as economic confidence dropped from October to November in 2007 and 2008, Discover reported. The November 2008 index of 67.5 is the low point for the Watch since it started in August 2006.
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