Small businesses believe the economy will get worse before it gets better

Small businesses have been given little reason to be optimistic in the past few months, with small business lending down and a federal aid bill stalled. As a result, owners have little faith left for prospects of an economic recovery, a recent study finds.

In July, the Discover Small Business Watch found that 75 percent of small business owners surveyed believed it was likely or highly likely that the U.S. economy will experience a double-dip recession before improving.

The number of business owners who ranked the economy as “poor” also increased to 58 percent from 51 percent in June. Only 7 percent of respondents said the economy was good or excellent.

“They'll be holding back their economic enthusiasm until they have tangible evidence that their bottom lines are improving," said Ryan Scully, director of Discover's business card, which commissions the monthly research.

Despite dim prospects for the future, 28 percent of small business owners still said they would be increasing spending during the next six months.

However, without access to funds, it will be difficult to do so. According to the Business Journal of Milwaukee, small business lending in Wisconsin fell dramatically by 55 percent from the same period last year.