4 Signs That Small Businesses Will Boom in 2023

Few people are more resilient (or optimistic) than small business owners.

There's no denying the global pandemic did a number on the economy. Along with the rest of the world, the U.S. suffered financial losses. Still, all is not doom and gloom. While there are no guarantees, there are signs indicating that small businesses may do just fine in 2023. Here are four of them.

1. The U.S. economy had a surprising third quarter

The Commerce Department says gross domestic product (GDP) rose 0.6% in the third quarter of 2022. That represents a 2.6% annual rate of growth. While that growth falls below historic trends, it serves as a reminder that the economy is not collapsing. Not only might that be good news for small businesses, but it could positively impact investors across the board. 

2. Business owners recognize the challenges

A recent Bank of America (BOA) survey of more than 1,300 small business owners across the country finds that 66% expect their revenues to increase in 2023. What’s more, 52% have plans to expand their businesses.

Perhaps these business owners are optimistic, but they are not delusional. According to the survey, they know precisely the type of challenges they face. Here are some of the other findings of the BOA survey:

• With the potential of recession looming, 77% of those surveyed say their business is equipped to survive a recession.
• Business owners are not blind to the issues swirling. For example, they're keeping their eyes on these issues: inflation (75%), commodities prices (69%), a potential recession (67%), the U.S. political environment (66%), and interest rates (65%).

Understanding the problems (and potential problems) facing them, small business owners are in a better position to plan for surviving whatever may come their way.

3. Many have help

Another interesting aspect of the BOA survey is how many business owners can count on family to help when staffing or other issues arise. For example, 80% of Asian Americans and Pacific Islanders (AAPI) business owners say they get support from their families.

While we don't know for certain, it's easy to imagine that those with family support have cause to be more optimistic. After all, if an employee fails to show up or the business owner gets sick, there's someone to step in and help.  

4. Hiring serves as an indicator

The shortest recession in American history occurred in the early months of the pandemic. Since that time, financial experts have warned of another. They’ll be right at some point. It's inevitable that the U.S. economy will suffer another recession. It's the way the economy works. The problem is this: No one knows when the next recession will hit, whether it will be devastating, or if we’ll weather it with fewer-than-expected problems. 

But all of that is white noise to business owners who simply need more employees. Across the country, the demand for new employees has continued to rise. Even as business owners prepare for the day a recession arrives, they're busy trying to attract new talent. 

And maybe it's the fact they're busy enough to need new workers that gives them reason to believe 2023 will be just fine.

None of us can predict the future with 100% accuracy, but while the rest of the world goes around crying that the sky is falling, small business owners have their noses to the grindstone, with a touch of optimism driving their efforts.