A new survey from JP Morgan Chase among U.S. small and midsized companies found that recession fears are waning while the willingness to embrace AI is growing.
According to the survey, 46% of midsize businesses are “currently using or considering adopting AI.” Among those that do use AI, some of the most popular applications include “business operations (69%)” and “internal/external communications (63%)”.
In addition, almost half of the midsize businesses engaging or considering engaging with AI are looking at AI for “financial management/accounting (48%)” and “human resources/training purposes (47%)”.
According to JP Morgan Chase, the survey finds that smaller companies are coming around to embracing AI.
“While small businesses find social media tools, virtual meeting platforms, and cloud technologies more essential to their business than AI, it ranks as the technology they’re most likely to add in the coming year, with 46% of small businesses planning to do so.”
The JPMorgan Chase’s 2024 Business Leaders Outlook survey (released yesterday) surveyed 817 U.S. businesses.
On the economic front, optimism tends to grow when questions focus on a company’s local economy vs the overall U.S. economy.
For example, 44% of midsize companies say they are optimistic about the near future for their local economy vs. just 31% for the U.S. national economy. It is much closer among smaller companies, with 43% feeling optimistic about the national economy vs 46% for their local economies.
Recession fears have receded among U.S. businesses, according to the survey.
“In the new survey, 40% of midsize and 51% of small business leaders anticipate a recession in 2024,” JP Morgan Chase shares its announcement of the survey results, “Or [they] believe we’re already in one. {This is] down from 65% and 61% respectively.”
Venture Deals at Three-Year Low
The relatively optimistic data from JPMorgan Chase contrasts with less sunny news on the venture funding front. We’ve recently written about (and will discuss on next week’s podcast) the fallout from the dramatic pullback in venture funding, which contributed to an eye-popping number of startup failures in 2023 (543 by one count).
We came across another data point today that suggests the venture funding environment isn’t exactly poised for a rebound.
According to multiple reports citing data from Pitchbook and the US National Venture Capital Association, in Q3 of 2023, venture deal volume hit its lowest level in three years. Notably this data is generally being read as firm evidence that the venture capital boom that started during the pandemic is over, rather than evidence that the dry spell will continue into 2024.
Still, no one seems to be predicting another VC boom in 2024. At best, some are expressing cautious optimism that the equity funding and M&A environments may marginally improve this year.
