The uncertainty surrounding the "fiscal cliff" is directly impacting the strategic decisions of many US business owners, according to a new survey by Sageworks, a financial information company. In the survey, accounting professionals were asked to gauge the fiscal cliff's effects on their business clients.
Over 50 percent of respondents said their clients were making changes in their businesses as a result of the uncertainty surrounding the fiscal cliff. Only a quarter of respondents said their business clients were not making changes because of this uncertainty.
Sageworks CEO Brian Hamilton explained that the uncertainty surrounding the fiscal cliff debate adds yet another layer of complexity to business decisions: "Private companies operate in extremely risky environments that most of us would not accept", Hamilton noted. "Business owners already have enough to worry about, and now they're further burdened with how new policies are going to affect their bottom line and discretionary income."
When asked about their clients' fears regarding the fiscal cliff:
Almost 30 percent of respondents said their business clients were most worried that the uncertainty would continue.
Twenty-one percent said their clients worried about a fiscal cliff solution that would negatively affect their businesses.
Twenty percent said their clients feared that the fiscal cliff solution wouldn't address the longer term issues of government spending and the national debt.
Eight percent said the biggest concern was that we will actually "go over" the cliff.
Only 3 percent of respondents said their business clients aren't worried about the fiscal cliff.
In a survey conducted by Sageworks in November, financial professionals said the US national debt was impacting their business clients' hiring and investment practices. At its best, a plan to address the fiscal cliff would tackle our national debt head on. However, Hamilton says any plan would be better than the current stalemate: "You can't expect businesses to plan for their 2013 and 2014 operations when you throw new policies at them on December 31."
About the survey:
Sageworks conducted the online survey between December 12 and December 18, 2012, collecting responses from 164 accountants and business advisors. The poll's respondents were all clients of Sageworks and were not randomly selected.