Main Street has caught up to Wall Street, at least when it comes to increased fears of a recession. A narrow majority of small-business owners across the United States expect a recession in the next year, according to the latest CNBC/SurveyMonkey Small Business Survey. This was the first time in the two-year-plus history of the survey that small-business owners were asked for their recession forecast, but the broader survey trends over time indicate more caution on the part of entrepreneurs as multiple readings of small-business sentiment have declined. The record level for the CNBC/SurveyMonkey Small Business Confidence Index was reached in the third quarter of 2018 and has declined since then. Expectations for revenue and hiring, as well as over business conditions, also have declined from peak levels in Q3 2018. The survey — which was conducted by SurveyMonkey among more than 2,200 small-business owners across the country between Jan. 28 and Feb. 4 — does not indicate a major retreat on Main Street when the results are viewed on a longer-term basis. The current levels for these indicators remain much higher than they were a few years ago. The confidence decline from the third-quarter 2018 peak level occurred over the same period of time when the U.S. stock market, which soared into the third quarter of last year, suffered a dramatic decline with many sectors of the economy ending 2018 in a correction (decline of 10 percent) or bear market (decline of 20 percent). "While a slim majority of small-business owners see a recession ahead, there's little sign that they think it's imminent," said Jon Cohen, chief research officer at SurveyMonkey. "The small-business index has tapered off from its peak in Q3 2018, but it certainly hasn't hit a wall, and several of its core components remain strong," Cohen said.

Decline from Q3 2018 peak Business outlook Q1 2019 Q4 2018 Q3 2018 Described business conditions as good 52 percent 55 percent 58 percent Expect increased revenue 57 percent 58 percent 62 percent Plan to increase full-time staff 28 percent 29 percent 33 percent Small business confidence index level 58 59 62

Government dysfunction is one place to look for a cause of declining confidence, especially with the recent shutdown and impasse over immigration reform between President Donald Trump and the Democratic Party opposition newly in control of the House. Only 20 percent of small-business owners said the shutdown was a major concern for their business. But the shutdown had significant effects on businesses in certain areas of the country where consumer bases are heavily employed by government agencies, and it did lead to sales slowdowns for one-third of all businesses, as well as management frustrations for owners across the country. The CNBC/SurveyMonkey data revealed that non-small business owners are more likely to think small businesses would be hurt by a shutdown than the business owners actually were. There is a deadline this Friday for a border deal to remove the threat of another shutdown. No agreement has been reached yet on Capitol Hill.

Recession talk is everywhere