CHART OF THE WEEK: Microbusiness Cash Flow Improving


In March 2011, Discover Card’s monthly survey of owners of companies with fewer than six employees (i.e., microbusiness owners) showed that 43 percent reported experiencing temporary cash flow problems.  The good news is that this figure was down seven percentage points from the previous month.  The bad news is that it remains higher than its 39% average before the recession.

The thin black line in the figure below shows the measure’s three month moving average. It indicates improvement in the cash flow situation of micro-businesses since the middle of the summer of 2010.

Percent of Microbusiness Owners Reporting Cash Flow Issues

August 2006 – February 2011

Microbusiness cash flow in recessionCLICK FOR LARGER CHART



Scott Shane Scott Shane is A. Malachi Mixon III, Professor of Entrepreneurial Studies at Case Western Reserve University. He is the author of nine books, including Fool's Gold: The Truth Behind Angel Investing in America ; Illusions of Entrepreneurship: and The Costly Myths that Entrepreneurs, Investors, and Policy Makers Live By.