Responses from the third quarter 2012 Greater Cincinnati Family Business Survey indicate that local family business owners are less positive about business conditions than they were in our second quarter survey -- though the majority does expect the economy to grow. Respondents were especially reserved about the national economy’s near-term prospects, though they anticipate medium-term improvement.
Responses suggest that area family firms continue to believe that long-term economic growth will not be strong enough to warrant current investment in expansion. While respondents expressed some optimism in many survey categories, levels in most categories declined compared to the last report.
A majority of local family business owners expect growth in the areas of real sales and higher earnings. Most also expect to increase employment and have seen a decrease in current job vacancies. Yet, most respondents do not believe that that now is a good time to expand and they do not plan to make capital expenditures in the near future. In fact, since the 2nd quarter of 2012, there has been a decrease in the share of local family businesses who believe now is a good time to expand, who expect more favorable credit conditions, and who plan to increase employment.
When compared with previous reports, there was an increase in the share of respondents who expect new sales, plan to make capital outlays, and had expectations the economy would improve. It is of note that the election fell between data collection & the issuing of this report.
The Goering Center Family Business Survey is designed so that local responses can be compared with the responses to the National Federation of Independent Businesses’ (NFIB) monthly survey of small and independent businesses throughout the nation. One caveat for this comparison is that—because we have only collected one year of data—we are not yet able to provide seasonal adjustments to the local GCFB responses. This means that we see larger changes from quarter to quarter than are reported by the NFIB. For example, the net percentage of local respondents saying now is a good time to expand decreased by 35% from the previous quarter, while the national percentage stayed exactly even when compared to the equivalent prior report.