Goldman Sachs small biz survey shows worries about accessing capital

Matthew Fazelpoor//May 5, 2023//

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As National Small Business Week winds down, a new survey from Goldman Sachs 10,000 Small Businesses Voices shows a complete shift in sentiment about owners’ confidence in accessing capital.

According to the May 4 survey results, 77% of respondents reported concern about their ability to get financing. That’s just a year after the same percentage said they were confident in their ability to access capital.

Of the respondents who applied for a small business loan in the past three months (17%):

61% found it difficult to access affordable capital, and
60% said rising interest rates are impacting their ability to service existing debt.

The survey, which polled 1,740 Goldman Sachs 10,000 Small Businesses Voices participants last month, comes amid a turbulent economic landscape with continued rising interest rates, concerns about a possible recession, uncertainty in the banking sector and a tight labor market.

Additionally, respondents voiced concern about the escalating situation over the debt ceiling in Washington, D.C., as the nation moves closer to possible default.

The survey found that 65% of respondents believe they would be negatively impacted if Congress does not raise the debt ceiling, with 90% saying it is important for the federal government not to default on its debt. Another 81% of those surveyed said it is important for Congress to enact spending cuts in conjunction with raising the debt ceiling.

“No one knows the exact date when the federal government will no longer be able to pay its debt, but these survey results make clear that a default would have very negative ramifications for small business owners,” said Joe Wall, national director of Goldman Sachs 10,000 Small Businesses Voices. “Over the coming weeks, America’s small business owners will be looking to Washington for certainty and a sound resolution to the nation’s credit crunch.”

Notable numbers

71% say inflationary pressures on their small business have increased over the past three months
44% say the business climate has gotten worse over the last three months
39% say the business climate has stayed the same
48% say profits are lower than before the pandemic
9% say they’ve transferred their bank deposits, despite sector turbulence
67% are watching AI closely
38% believe AI could have a positive impact on their businesses
15% believe AI will have a negative impact on their businesses

Another major challenge noted by respondents was the ability to hire and retain workers—a struggle so many small business owners face in a tight labor market with an historically low unemployment rate. The survey revealed that 78% of those currently hiring are finding it difficult to recruit qualified candidates, while 80% say that a lack of access to child care is a major barrier for workforce participation.

Just 17% of respondents say they have more than enough or the right amount of high quality, affordable child care options in their communities.

Other challenges and concerns respondents stressed included: inflation, lower profit margins and AI.

As NJBIZ has reported, Goldman Sachs 10,000 Small Businesses Voices is an initiative for participants to organize and advocate for policies that matter to them. It builds on the work of Goldman Sachs 10,000 Small Businesses, which over the past decade has provided access to education, capital and support services to more than 10,000 small business owners across the country.