Small Businesses Are Facing a Credit Crunch

National survey finds that 77% of small business owners are concerned about availability of capital, a shocking turnaround in sentiment from last April

On May 4, 2023

Small business owners are facing a credit crunch, with 77% of respondents reporting they are concerned about their ability to access capital, a stunning shift from one year ago when 77% said they were confident in their ability to access capital. This turnaround is just one key takeaway from a survey of small business owners from Goldman Sachs 10,000 Small Business Voices released during National Small Business Week.

Of respondents who have applied for a small business loan in the past three months (17%), 61% have found it difficult to access affordable capital. Sixty percent said rising interest rates are impacting their ability to service existing debt.

“Rising interest rates and tighter credit conditions have made it far more difficult to access affordable funding to support small business growth,” said Lou DeCuzzi, president of

DDR USA in Brunswick, Ohio, and an alum of the Goldman Sachs 10,000 Small Businesses program. “These compounding challenges offer yet another reason why Congress should modernize the Small Business Administration, the agency charged with making certain small business owners like me have abundant access to capital.”

Small business owners also voiced concern about the debt ceiling fight in Washington, D.C., with 65% saying they would be negatively impacted if Congress does not raise the debt ceiling and 90% saying it is important for the federal government not to default on its debt. 81% of those surveyed said it is important for Congress to enact spending cuts in conjunction with raising the debt ceiling.

“No one knows the exact date when the federal government will no longer be able to pay its debt, but these survey results make clear that a default would have very negative ramifications for small business owners,” said Joe Wall, national director of Goldman Sachs 10,000 Small Businesses Voices. “Over the coming weeks, America’s small business owners will be looking to Washington for certainty and a sound resolution to the nation’s credit crunch.”

Hiring and retaining workers continues to pose a challenge to small business owners, with 78% of those currently hiring finding it difficult to recruit qualified candidates. Small business owners say (80%) that a lack of access to child care continues to be a barrier to workforce participation with only 17% saying there are more than enough or the right amount of high quality and affordable child care options in their communities. Small business owners strongly support (80%) policymakers taking action to increase access to affordable child care.

Other notable data points from the survey of small business owners include:

• 71% said inflationary pressures on their small business have increased over the past three months.
• Compared to three months ago, 44% said the business climate has gotten worse, with 39% saying it has stayed the same.
• Looking at their bottom line post-pandemic, 48% say their profits are lower than before the pandemic.
• While the collapse of Silicon Valley Bank rattled global markets and put the spotlight on banks, only 9% of small business owners transferred their bank deposits as a result.
• Small business owners are keeping an eye on emerging technology, like artificial intelligence (AI). Sixty-seven percent are watching news about AI closely, with 38% believing AI could have a positive impact on their business and 15% saying it will have a negative impact.

This data is based on a survey of 1,740 Goldman Sachs 10,000 Small Businesses participants conducted by Babson College and David Binder Research from April 20-25, 2023. The survey included small business owners from 48 U.S. states, Washington, D.C., and Puerto Rico.

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