Attitudes toward the United States economy are on an upswing headed into the fall, as recent reports indicate that fiscal confidence—particularly for small businesses and startups—is higher than it’s been in years.
The Deloitte CFO Signals Survey for 3Q 2023, for instance, shows that the number of CFOs that rate the current North American economy favorably has jumped from 34 percent in 2Q to 57 percent over the summer months. This is the highest reading for the overall economy since 1Q 2022, while optimism toward CFO’s own financial prospects jumped +22 over the last quarter—up from +6 in 2Q.
A particularly interesting metric in Deloitte’s findings is that 41 percent of CFOs polled believe “now is a good time to take greater risks” compared to just 33 percent of CFOs in Q2.
This comes as 43 percent of CFOs polled have begun exploring more generative artificial intelligence (AI) to streamline operations and explore greater channels for growth. This claim lands despite many financial leaders admitting to potential limitations related to talent and capabilities in harnessing new technologies.
“Companies are looking to strengthen their operations, and many are looking at GenAI as a potential value-add to reduce costs, improve experiences for their customers and clients, and increase margins, as well,” Steve Gallucci, national managing partner, U.S. CFO Program, Deloitte LLP, said in the report.
However, Deloitte US CEO Jason Cirzadas offers a warning:
“While nearly half of CFOs’ organizations are experimenting with Gen AI, many continue to assess how this will impact their business strategy […] it will be important to identify the right use cases that will drive efficiencies and create new sources of value.”
Small businesses feeling positive about economic growth
The U.S. Chamber of Commerce recently released a similar study gauging the attitudes of SMBs over the past quarter. The study found that 66 percent of small businesses owners polled believe they are in good financial health, while 72 percent report solid cash flow.
Still, SMBs and startups alike share concerns around both inflation and employee retention. The number of SMB leaders polled who view employee retention as a top challenge has doubled over the past two years (15 percent today vs. 7 percent in 3Q 2021), despite 82 percent of those surveyed agreeing that smaller businesses are “uniquely qualified” to support their workforce compared to larger businesses.
While inflation remains the top concern for SMBs, the report finds, many are less concerned about the prospects of a prolonged recession compared to polls taken earlier in the summer and spring.
“With fears of a recession likely in the rearview mirror and inflation starting to ease, small businesses owners are feeling a lot better than they were a year ago,” said Tom Sullivan, Vice President of Small Business Policy at the U.S. Chamber of Commerce, in the report.
Adding to this optimism is a revised forecast from the Atlanta Federal Reserve that was dropped last week, which anticipates that the economy during Q3 will have grown at a 4.9 percent annual rate, a one percentage point increase from its Aug. 1 estimate.
Despite optimism, a robust capital strategy is key for startups
While everyone from enterprise CFOs to founders on Main Street are taking a cautiously optimistic view on their business prospects heading into the fall, startups and new businesses are still largely navigating some unique economic tailwinds.
For instance, while stable inflation rates may indicate a favorable lending environment for early-stage startups, venture capital (VC) activity remains well below the pandemic-era highs of 2021.
Fortunately, startups don’t need to (nor should they) rely on a single source of funding to fuel their runway.
At both the federal and state levels, there are a wealth of non-dilutive funding opportunities that startups focused heavily on R&D can leverage to cover their operating costs and extend their product roadmap.
Boast syncs financial, workflow and product data into a single source of R&D intelligence to help founders optimize their strategies and design a capital roadmap that helps their business meet critical goals. Our platform and expertise become especially valuable in the lead-up to final tax deadlines—including the upcoming October 15th tax extension for US businesses in just a few weeks.
For first-time Boast customers, we’ll even offer a 30 percent discount on our services to help you claim before October 15th. Reach out today to learn more and get started.
Talk to an expert from Boast AI today to learn more about how we combine cutting edge technology with years of expertise—and a founder’s POV—to optimize your R&D and fund your innovation.