The close of 2012 brought a lot of indecision and economic questions to the business world, and investors with trepidation about what the future would bring were reticent with financial plans. Many pulled their money back and tightened their belts so as to reduce liabilities they saw as potentially dangerous to economic fitness. In response, some firms have seen a slight decline in confidence and revenue, but promise for 2013 rebounds could be encouraging additional financial opportunities.
Rebuilding from the bottom
The National Federation of Independent Business (NFIB) wrote that December's small business confidence index hit 88 points, the lowest it's been since March 2010, due in large part to the fiscal cliff crisis. Firms reported that they intended to spend more in the future, but for now employment and credit expectations remained low and continued to fall in some regions. Earnings are still dow in most places, but financial services aimed at better analytics and management techniques could help boost forthcoming confidence as companies of all sizes gain better governance over their money.
"The January survey results will be far more enlightening about how the sector views the [fiscal cliff] deal," said NFIB chief Bill Dunkelberg. "Higher taxes and minimal spending cuts may not be a panacea. The eleventh hour 'deal' has brought marginal certainty about tax rates and extenders and will provide some relief to owners, but it certainly doesn't guarantee a more positive forecast for the economy."
Taking the good from the bad
There are certain elements of recent economic events that are positive for companies. Some results for mid-January confidence reporting showed that firms were tentatively more optimistic about fiscal cliff rebounds.
ONTRAPORT, an automated business support provider, wrote that a review of its clientele, which represent a diverse stratification of various industries and corporation sizes, showed businesses were gaining momentum in the shadow of the fiscal cliff deal's passage. After financial investment advice left many private individuals holding larger amounts of money at the close of 2012 than they would have liked after clearing out potentially volatile parts of their portfolios, as a result the stock market has rebounded aggressively.
Despite previous reports from the NFIB that employment and hiring may take a hit, more than three-fourths of respondents to ONTRAPORT's survey said they had experienced better-than-expected sales. On top of that, most intend to bring on more personnel in response to these improved takings and increased liquidity. Companies acknowledged that financial services and stability are still in need of maintenance as they try to make smart acquisitions, but overall confidence in the market and the American economy could result in faster improvement than some analysts expected following the fiscal cliff debacle.