Small Business Optimism Improves to Highest Levels since Great Recession, but Recovery is Slow


Small Business Optimism Improves to Highest Levels since Great Recession, but Recovery is Slow

Wells Fargo/Gallup Small Business Index 10thanniversary survey shows improvement in access to credit

SAN FRANCISCO--(BUSINESS WIRE)-- Small business optimism is the highest it has been since third quarter 2008, according to the latest Wells Fargo/Gallup Small Business Index conducted July 22-26.

The Wells Fargo/Gallup Small Business Index improved 9 points since second quarter and 36 points since the fourth quarter of 2012, to a positive 25 (+25). A major driver of this improvement is business owner optimism around availability of credit now and in the future. While it's well below pre-recession levels, the Index score is the highest it has been in five years. In August, the Index marks its 10th anniversary of measuring U.S. small business owner perceptions of the economy and business impact.

"For 10 years, the Small Business Index has taken the pulse of small business owners in America," said Doug Case, Wells Fargo small business segment manager. "The survey has shown a slow and uneven recovery for small businesses, and this quarter we continue to see business owners express cautious optimism as economic trends improve, such as a strengthening housing market."

Access to Credit

Small business owners said they feel more optimistic about their ability to access credit over the next year. In the survey, 28 percent of small business owners said they expect credit to be very or somewhat easy to obtain in the next 12 months, up from 24 percent in the second quarter of 2013 and the highest percentage since 2009. Thirty percent said they expect credit to be difficult to obtain in the next 12 months - down significantly from the 36 percent recorded last quarter and the lowest this measure has been in five years.

Housing Impact on Small Businesses

The July survey asked business owners about today's real estate and housing market, and its impact on their businesses. A majority of small business owners (57 percent) said they have seen an overall improvement in the housing market in their area. At the same time, 42 percent reported that their business relies either somewhat (22 percent) or a great deal (20 percent) on a strong housing market. Moreover, 45 percent indicated that a rise in housing prices would improve their business's sales either somewhat (33 percent) or a great deal (12 percent).

Capital Spending

In the most recent survey, 25 percent of small business owners reported an increase in capital spending in the past 12 months. Additionally 26 percent of business owners said they are planning to increase spending in the next 12 months, consistent with last quarter's results. The number one reason business owners cited for not making a capital investment was continued concern about the overall state of the economy (64 percent) followed by uncertainty in the future of their business (57 percent).

Small Business Index Key Drivers

Wells Fargo, together with Gallup, surveys small business owners quarterly across the nation to gauge their perceptions of their present situation (past 12 months) and future expectations (next 12 months) in six key areas: financial situation, cash flow, revenues, capital spending allocation, hiring, and credit availability.

Index Scores: Q3 2012 - Q3 2013

Overall Index Score

Present Situation

Future Expectations

Q3 2013

(surveyed July 2013)




Q2 2013

(surveyed April 2013)




Q1 2013

(surveyed January 2013)




Q4 2012

(surveyed November 2012)




Q3 2012

(surveyed July 2012)




10 years of Wells Fargo/Gallup Small Business Index


  • Q3 2003: The Small Business Index debuts with a score of positive 69 (+69).

  • Q4 2006: Index reaches highest score at positive 114 (+114).

  • Q2 2008: Index falls to positive 48 (+48) after 18 consecutive readings at or near positive 100 (+100).

  • Q1 2009: Index drops 14 points and falls into negative territory (-4) for the first time in the survey's history in the midst of the recession.

  • Q3 2010: The lowest reading for the Index is recorded at negative 28 (-28).

  • Q1 2011: Index begins to see improvement and climbs into positive territory with a score of positive 12 (+12).

  • Q3 2013: Index rises to positive 25 (+25), the highest level of optimism in five years.

Infographic:Wells Fargo/Gallup Small Business Index Q3 2013

Note: Complete survey results available upon request, or visit the Wells Fargo Business Insight Resource Center.

About the Small Business Index

Since August 2003, the Wells Fargo/Gallup Small Business Index has surveyed small business owners on current and future perceptions of their business financial situation. The Index consists of two dimensions: 1) Owners' ratings of the current situation of their businesses and, 2) Owners' ratings of how they expect their businesses to perform over the next 12 months. Results are based on telephone interviews with 602 small business owners in all 50 United States conducted July 22-26, 2013. The overall Small Business Index is computed using a formula that scores and sums the answers to 12 questions — six about the present situation and six about the future. An Index score of zero indicates that small business owners, as a group, are neutral -- neither optimistic nor pessimistic -- about their companies' situations. The overall Index can range from -400 (the most negative score possible) to +400 (the most positive score possible), but in practice spans a much more limited range. The margin of sampling error is +/- four percentage points.

About Wells Fargo

Wells Fargo & Company (NYS: WFC) is a nationwide, diversified, community-based financial services company with $1.4 trillion in assets. Founded in 1852 and headquartered in San Francisco, Wells Fargo provides banking, insurance, investments, mortgage, and consumer and commercial finance through more than 9,000 stores, 12,000 ATMs, and the Internet (, and has offices in more than 35 countries to support the bank's customers who conduct business in the global economy. With more than 270,000 team members, Wells Fargo serves one in three households in the United States. Wells Fargo & Company was ranked No. 25 on Fortune's 2013 rankings of America's largest corporations. Wells Fargo's vision is to satisfy all our customers' financial needs and help them succeed financially. Wells Fargo perspectives are also available at

Wells Fargo loans more money to America's small businesses than any other bank (2002-2011 Community Reinvestment Act government data) and is a leading lender to women- and diverse-owned businesses. With the nation's largest network of retail banking stores, and an award-winning online library of videos, articles and webcasts known as the Business Insight Series (, Wells Fargo provides business owners with timely advice and information to educate and help them succeed financially. For more information, or to speak with a Wells Fargo banker, visit or call the National Business Banking Center at 1-800-CALL-WELLS.

About Gallup

For more than 70 years, Gallup has been a recognized leader in the measurement and analysis of people's attitudes, opinions and behavior. While best known for the Gallup Poll, founded in 1935, Gallup's current activities consist largely of providing marketing and management research, advisory services and education to the world's largest corporations and institutions.


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