The proportion of small businesses planning to increase their capital spending in the next 12 months is at its highest rate in four years, according to a new Gallup poll.
Twenty-eight percent of small businesses plan to increase spending, while 23 percent plan to cut back, the biggest gap in positive percentage points since 2008. While many have plans to spend in the future, 24 percent of owners said they have already increased their spending in the last 12 months, up from 19 percent in October 2011. The number of owners who said they decreased capital spending has dropped eight percentage points from 43 percent in October.
The positive outlook on capital stretches to lending, as 27 percent of small-business owners felt it would be somewhat or very easy to obtain credit in the next 12 months. While 38 percent of owners still feel it may be difficult to obtain credit, the number has dropped from 43 percent since last year.
"The increase in U.S. small-business owners' capital spending expectations is consistent with their optimistic hiring intentions and with the high level of overall economic confidence," Dennis Jacobe, Gallup's chief economist and poll author, wrote of the findings. "It is also good news for the U.S. economy when small-business owners spend and invest more in their physical and human capital."