For the third straight quarter, Connecticut businesses say credit conditions are continuing to improve, but slowly.
According to the second-quarter 2010 CBIA/TD Bank Credit Survey, current credit conditions are the best they’ve been in more than a year, and businesses expect continued improvement.
“We’ve made some progress, but businesses need a full restoration of available credit in order to sustain economic growth and expansion,” said Peter Gioia, Â CBIA vice president and economist. “Continued access to credit allows businesses to make the investments in their plants and equipment, expand operations, and hire more employees.”
Nine percent of respondents rated current conditions as good or excellent, while 50 percent characterized them as average. Forty-two percent said current conditions are poor or fair, down from 50 percent in the first quarter of the year. Over the next three to six months, 11 percent expect credit conditions to improve, while 37 percent expect them to worsen, the lowest number in more than a year.
Other key findings from the survey:
- 27 percent of respondents said credit availability is a problem for their business
- 47 percent said without access to capital they have been unable to grow or expand their business, 29 percent said they have reduced their workforce, and 21 percent said they’ve been unable to finance increased sales
- 31 percent of respondents used financing within the last three months
- Businesses said they need capital to invest in new plants and equipment (40 percent), expand operations (16 percent), maintain current workforce size (14 percent), and hire new workers (13 percent)
