Report: Arizona Businesses Prospering Compared to National Survey
A new survey out from the Federal Reserve indicates that Arizona businesses are doing pretty well compared to national figures.
Out of the 10,300 total businesses that participated in the Small Business Credit Survey nationwide, 217 were Local First Arizona members. Here's how some of the survey results compare:
Higher number of Arizona businesses report operating at a profit at end of 2015 than national figures.
Profitability, End of 2015 (Local First AZ)
Profitability, End of 2015 (National)
Arizona businesses were better off in terms of hiring of employees.
Employment Change, Past 12 Months (Local First AZ)
Employment Change, Past 12 Months (National)
Arizona businesses appeared to be in a better debt position compared to the national survey.
Outstanding Debt, At Time of Survey (Local First AZ)
Outstanding Debt, At Time of Survey (National)
While these numbers appear promising for Arizona's local business community, the Small Business Credit Survey did reveal that many local businesses are still challenged with getting the financing that they need to grow, hire, and expand.
77% of respondents that had applied for financing said that they were successful, on par with national average, but that still leaves 23% who were unsuccessful.
Furthermore, of those who said they did not apply for financing, 38% said they did not apply for negative reasons including being debt averse, being discouraged by the process, that the search was too difficult, and that costs were too high.
For Local First Arizona, we have maintained that the solution to increasing access to capital has been through support of local banks and credit unions, as they are more likely to lend to local businesses. Currently, only 7% of Arizona's bank assets are held by local banks and credit unions, even though local banks and credit unions are far more likely to lend to local businesses than the big banks that control most of our assets.
Things are looking optimistic for local businesses, but some challenges still remain around financing. We hold the power to help our communities' local businesses by moving our money to local banks and credit unions to provide more resources for financing.