Main Street Is Open for Business: Bank of America Survey Reveals Strong Economic Outlook Among Small Business Owners

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Small Business Owner Optimism and Confidence in the Economy Is at Its
Highest Level Since 2012

CHARLOTTE, N.C.–(BUSINESS WIRE)–America’s small businesses are gearing up for growth. According to the fall
2015 Bank of America Small Business Owner Report
, small business
optimism is at its highest since the survey’s inception in 2012, with
expectations for revenue growth and plans to hire hitting a three-year
high.

The report, based on a semi-annual survey of 1,000 small business owners
across the country, revealed that 72 percent expect their revenue to
increase in the next 12 months, compared with 62 percent a year ago. In
addition, more small businesses expect to increase staffing, with 67
percent planning to hire more employees over the next 12 months, up
significantly from 51 percent in the fall of 2014 and 31 percent in the
fall of 2013.

Confidence in the local, national and global economies rose as well:

  • Sixty-two percent expressed optimism for their local economies (a 12
    percentage point rise year over year).
  • Fifty-six percent expressed optimism for the national economy (an 11
    percentage point rise year over year).
  • Forty-five percent expressed optimism for the global economy (a 14
    percentage point rise year over year).

This optimism was seen even as small business owners expressed
apprehension over the 2016 presidential election, minimum wage hikes and
an increase in interest rates, as more than one-third of those surveyed
expressed concern that these factors could impact their business in 2016.

“We’re seeing a dramatic increase in optimism among small business
owners in the economy, revenue growth and hiring,” said Robb Hilson,
Bank of America Small Business executive. “Even with instability in the
global markets and the uncertainty they have about the upcoming
election, small business owners are confident and ready to expand their
businesses. They are seeing the light at the end of the tunnel, and we
commend them for their entrepreneurial spirit and stamina through a
challenging economic time.”

Not surprisingly, this expected growth demands more capital. More than
one in three small business owners (35 percent) say they will apply for
a loan in 2016, an 11 percentage point increase over one year ago. In
addition, the number of small business owners who report they have
applied for a loan in the past two years has increased by more than 50
percent in the last 12 months, rising from 29 to 44 percent.

Small business owners embrace workplace 2.0
The workplace
culture of the traditional small business appears to be changing, as
working environments become more technology-oriented and flexible. For
example, most small business owners (88 percent) say that technology is
helping them better serve customers, and half have invested in new
technology over the past five years to better connect with employees.
Nearly three-fourths (71 percent) report that they are investing in
technology upgrades one or more times per year.

Forty-seven percent of small business owners are now offering
telecommuting options – a 12 percentage point jump from five years ago.
Most small business owners report a positive impact from this shift,
including a better attitude in employees (59 percent) and increased
productivity (54 percent). However, some small business owners expressed
concerns that telecommuting makes employees unreliable or inaccessible
(34 percent), or harder to trust (33 percent).

Employee benefits are also changing, with small businesses taking a page
out of the startup book by offering perks like areas to relax or unwind
such as nap pods and game rooms (20 percent), pet-friendly work
environments (11 percent) or onsite gyms and fitness classes (8 percent).

Small businesses prepare for cyber-attacks as holiday season draws
near

As technology advances, so do cybersecurity threats. More
than one in 10 (12 percent) small business owners report that they have
been the victim of a cybersecurity breach. With technology being so
prevalent, more than half (59 percent) have expressed concern over
protecting their proprietary data, and 66 percent report they have taken
measures to be prepared for a cyber-attack.

These measures may pay off during the holiday shopping season. Small
business owners expect a boost to their business bottom line during
Black Friday and Cyber Monday, even more so than a year ago, with 31
percent expecting Black Friday to provide a bump in sales in 2015
(compared to 17 percent in 2014), and 43 percent expecting Cyber Monday
to have an impact on their business’ bottom line, compared to 29 percent
one year ago.

Local insights across the country
The report also analyzed
the mindset of small business owners in nine local markets across the
country. Key insights gathered include:

  • Like their national counterparts, most small business owners in a
    number of markets are planning for growth over the next five years.
    Small business owners in Washington, D.C. (81 percent), Miami (80
    percent) and Dallas/Fort Worth (78 percent) plan to grow their
    business over the next five years. Additionally, small business owners
    in Atlanta (73 percent), San Francisco (71 percent) and Metro New York
    (70 percent) expect their revenues to increase in the next year.
  • Optimism in an improving local economy followed the national trend
    within local markets as Washington, D.C. (65 percent), Dallas/Fort
    Worth (63 percent) and Boston (52 percent) small business owners are
    feeling increasingly confident in their local economy compared to one
    year ago. In fact, Los Angeles was the only market surveyed where
    local small business owners were less confident that their local
    economy would improve over the next 12 months (53 percent, versus 62
    percent in fall 2014).
  • Small business owners across all markets, including Chicago (44
    percent), Washington, D.C. (42 percent) and Los Angeles (41 percent),
    agree with their national counterparts that their workplace has become
    more tech-focused over the past five years. In addition, San Francisco
    (50 percent) and Washington, D.C. (47 percent) small business owners
    feel that their workplace has become more collaborative.

For a complete, in-depth look at the insights of the nation’s small
business owners, read the entire fall
2015 Bank of America Small Business Owner Report
, and for additional
insights, download the Small Business Owner Report national infographic here.

About the Bank of America Small Business Owner Report
Braun
Research, Inc. conducted the Bank of America Small Business Owner Report
survey by phone from August 21 through September 22, 2015, on behalf of
Bank of America. Braun contacted a nationally representative sample of
1,001 small business owners in the United States with annual revenue
between $100,000 and $4,999,999 and employing between 2 and 99
employees. In addition, 300 small business owners were surveyed in each
of nine target markets: Los Angeles, Dallas, Washington, D.C., New York,
Boston, Chicago, San Francisco, Atlanta and Miami. The margin of error
for the national sample is +/- 3.1 percent; the margin of error for the
oversampled markets is +/- 5.7 percent, reported at a 95 percent
confidence level.

The Braun Research survey results conducted on behalf and for the
exclusive use of Bank of America and interpretations in this release are
not intended, nor implied, to be a substitute for the professional
advice received from a qualified accountant, attorney or financial
advisor. Always seek the advice of an accountant, attorney or financial
advisor with any questions you may have regarding the decisions you
undertake as a result of reviewing the information contained herein.
Nothing in this report should be construed as either advice or legal
opinion.

Bank of America
Bank of America is one of the world’s leading
financial institutions, serving individual consumers, small and
middle-market businesses and large corporations with a full range of
banking, investing, asset management and other financial and risk
management products and services. The company provides unmatched
convenience in the United States, serving approximately 47 million
consumer and small business relationships with approximately 4,700
retail financial centers, approximately 16,100 ATMs, and award-winning
online banking with 32 million active users and more than 18 million
mobile users. Bank of America is among the world’s leading wealth
management companies and is a global leader in corporate and investment
banking and trading across a broad range of asset classes, serving
corporations, governments, institutions and individuals around the
world. Bank of America offers industry-leading support to approximately
3 million small business owners through a suite of innovative,
easy-to-use online products and services. The company serves clients
through operations in all 50 states, the District of Columbia, the U.S.
Virgin Islands, Puerto Rico and more than 35 countries. Bank of America
Corporation stock (NYSE: BAC) is listed on the New York Stock Exchange.

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Contacts

Reporters May Contact:
Don Vecchiarello, Bank of America,
1.980.387.4899
don.vecchiarello@bankofamerica.com