IMGCAP(1)]
Small-business owners' confidence rose in July for the second consecutive month as more respondents said they believe the economy is looking up. The Discover Small Business Watch index in July rose to 82.1, up from 80.9 in June. The Watch is a monthly report measuring the relative economic confidence among 750 small-business owners based on their responses to six questions in a telephone survey. Its creators established a base index of 100 when the Watch began in August 2006. Some 30% of small-business owners in July said they believe the economy is improving, up from 26% who did in June. Those who believe the economy is getting worse fell to 50%, the lowest level since May 2007. That compares with 57% of respondents who in June said they believed the economy was getting worse. Some 49% of respondents said they plan to cut business-development spending, down from 51% who said so in June. While optimism about the economy rose, cash-flow concerns in July reached the highest level in the Watch's history. Some 53% of small-business owners said they had encountered temporary cash-flow issues within the previous 90 days causing them to postpone paying some bills, up from 42% who said they had such cash-flow difficulties in June. In answer to survey questions the Watch asks respondents only periodically, 33% in July said they have had to borrow money to pay for business expenses, up from 19% who said so in October 2008, the last time that question was asked.
