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Businesses upbeat about own prospects, wary about economy

NEW YORK (AP) — Small and mid-size business owners are upbeat about their companies, but also a little wary about the economy.

That’s the finding of a survey released last week by researchers at Pepperdine University’s Graziadio Business School and Dun & Bradstreet Corp. The survey, which questioned nearly 600 companies with revenue of up to $100 million, found that nearly 80 percent expect to perform better in 2019 than last year. Among the smallest companies, those with up to $5 million in revenue, 9 percent expect higher annual revenue, a slight uptick from 8.9 percent in a survey taken during the fourth quarter. But mid-size companies, those with $5 million to $100 million in revenue, are less optimistic about their prospects — 7.5 percent forecast higher revenue versus 8.5 percent in the previous survey.

The number of companies planning to hire in the next six months was up slightly; just 31 percent said they did not plan to hire, down from 36 percent in the fourth quarter. But nearly a third of those who don’t expect to hire say uncertainty about the economy is stopping them from adding staffers.

The latest survey was conducted between late January and early February, as uneasiness about the economy was dampening small business optimism in other surveys and unnerving stock investors. Most economists are forecasting a slower economy later this year.

Uncertainty about the economy has kept many owners cautious about hiring and taking on debt in recent years. The Pepperdine/Dun & Bradstreet survey shows demand for new financing has remained low this quarter, with just 29 percent of companies saying they tried to raise outside financing in the past three months. That is little changed from 27 percent in the fourth quarter.

Small companies that sought bank loans had a slightly harder time getting them. Nearly 44 percent reported success in getting loans, down from nearly 46 percent in the fourth quarter.

Looking forward, many companies said they have no reason to seek new financing, in line with the trend of the past few years. Two-thirds of all the businesses said they have enough cash flow to take care of their expenses. Nearly 40 percent said they had enough financing in place.

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