Optimism returns to business climate

Small business is bullish again.

At least that's what the latest Wells Fargo/Gallup Small Business Index survey is showing. In fact, the survey says small business is the most optimistic it's been since July 2008.

"While this economy still presents challenges for many business owners, we are encouraged by expectations for improved revenues, financial situation and cash flow - which have the potential to drive job growth," says Doug Case, who is Wells Fargo's small-business segment manager.

Ron Coccaro, a business-banking area manager for Wells Fargo's Connecticut and New York operations, agrees, saying he's seeing renewed optimism when visiting his small-business clients - and that bodes well for the overall economy, since small business plays such an important role in hiring.

"The trends are positive," says Coccaro. "Revenue trends are up for a large majority of our clients."

Wells Fargo, a national financial-services company, has 74 community bank branches in Connecticut, along with eight mortgage centers and more than 100 automated teller machines. It's making a big commitment to Connecticut, more than doubling its grants to nonprofits to over $1.5 million this past year and adding more business-development and new-relationship officers. Coccaro says his firm is expanding across the state "and we're trying to meet the demands for what we foresee as our future growth in Connecticut."

Wells Fargo has done its small-business survey since 2003, and it's encouraged by this latest survey's results. The company found a more bullish sentiment across several categories in the quarterly survey, which it released this month.

Nearly half those responding expect to see revenues grow this year, and more than 60 percent expect their overall financial condition to be "very or somewhat good." In addition, almost a quarter said they would be hiring this year, and a majority expect their cash flow - vital to a small business' success - to be better this year.

The survey also noted that half of the small-business owners surveyed said that, as a general rule, they find it "very difficult" or "somewhat difficult" to find the right qualified candidates to fill their vacancies. Also interesting, the survey said that in the event that a small business can't afford to hire a new employee, it will turn to a spouse, a friend, children, or a relative for unpaid help.

Coccaro says the small-business survey is a good business-planning tool for his financial-services company. "When there's a growth market, that helps us, and helps the local economy, as well," he says.

Case says Wells Fargo offers many services to help business grow the bottom line. He says its Business Insight Resource Center is a business friendly web portal offering videos, podcasts and articles on a range of topics and issues for businesses large and small. The material can be viewed at www.wellsfargobusinessinsights.com.

January's increase in optimism signals that small business owners are seeing a brighter future, says Case. Yet there is, he admits, "still a lingering caution."

"Small business owners are becoming more optimistic, and they have plans for more hiring, but are still waiting for a more demonstrated and longer-term indication that things are on a good trajectory in terms of economic strength."

Anthony Cronin is The Day's business editor.