- JPMorgan Chase survey finds growing share of companies expect greater credit needs this year
- More than half of respondents say they plan to expand into new markets and locations, with a similar share looking to innovate or diversify their products
- Business leaders are more optimistic than a year ago, but less optimistic than they were during the summer
Summary by Dirk Langeveld
Small businesses are optimistic about their economic performance this year but also expect that their credit needs will increase, according to the recent JPMorgan Chase Business Leaders Outlook survey.
The survey collected responses from 1,602 business leaders, mostly at small or midsize companies, in November. Ninety-five percent said they expect their revenues to increase or stay the same in 2022, while 88 percent expect the same for their profits. Seventy percent said their profitability has matched or exceeded pre-pandemic levels.
Forty-two percent said they expect their credit needs to go up this year, a 12-point increase from the previous year’s survey. Lines of credit were the most popular option, with 59 percent saying they are currently using one and 17 percent saying they plan to use one.
- 45 percent say they believe their capital expenditures will increase this year, up 13 points from 2020
- Only 13 percent said they are using a non-traditional bank or financing solution
- Business leaders were more optimistic than last year about global, national, and local economies as well as industry and company performance, though all of these readings were lower than they were in a summer pulse survey
- 52 percent said they plan to expand into new markets or locations, while 49 percent plan to innovate or diversify their products and services and 48 percent think consumer demand will drive growth
- More than half of respondents have set up online bill pay or cashless payments or plan to do so
- 68 percent said they are experiencing a tighter labor supply, while 62 percent said they are experiencing supply chain challenges and 58 percent said the cost of doing business is higher
- 68 percent say a skills gap is making it take longer to fill positions; the same share says a labor shortage is driving current employees to work more
- 81 percent are raising wages to try to attract and retain workers, while 45 are offering more flexible work locations