Small Businesses Plan Investment Increases

Showing Signs Of Recovery After Difficult 2011

Small Businesses Plan Investment IncreasesA new survey shows that many U.S. small businesses are reporting increased liquidity and say they plan to invest in their growth for the remainder of 2012. According to the Capital One Small Business Survey, small businesses (companies with less than $20 million in annual revenues) are showing signs of recovery after reporting a difficult economic environment in 2011.

For the first time in three quarters, more small businesses are reporting that their financial performance is better than the year-ago period than say it's the same, according to the Capital One survey. Additionally, four out of five companies surveyed said their financial performances met expectations for the quarter. And, roughly 15% of small businesses across the country said they have job openings they are unable to fill. Companies in government, utilities and mining sectors are most likely to have job openings they can't fill.

"The latest survey results show some positive signs that more small businesses are beginning to focus on hiring, with the increase in the number of small businesses making plans to hire compared to the previous quarter at the highest level in over two years," said Jon Witter of Capital One.

Indeed, more small businesses surveyed by Capital One are making plans to hire new employees compared with last quarter. Roughly 34% of small businesses plan to hire more employees over the next six months, compared with 27% last quarter and 30% in the year-ago quarter. At the same time, company liquidity has improved, as nearly 25% of small businesses said they had obtained financing in the last 12 months, up from 19% in the fourth quarter and 23% in the year-ago quarter.