The PNC Economic Outlook Survey of small business owners in Pennsylvania shows increasing optimism about their sales and hiring.    61% are optimistic about the local economy in the near future, an improvement from the fall survey. A growing number, 18% compared to 9% in the fall, expect to hire full time employees. More than half expect sales to increase.

Gus Faucher , a senior economist with PNC Financial Services Group, says the Pennsylvania economy is doing better in general than the national economy.  He says it tends to be concentrated in stable industries and it’s benefiting from natural gas exploration.  He says small business owners in the state are  the most optimistic they’ve been since prior to the Great Recession.

More than half expect sales to increase. However, there is some concern about inflation, especially in light of rising gasoline prices.  Faucher says 79% of those surveyed expect consumer prices to rise in the coming year, perhaps influenced by the jump in gas prices.

Faucher says the survey shows renewed interest in credit. 15% said they will likely take out a new loan or line of credit in the next six months. While more than one-fifth still say credit is difficult to obtain, he says that number has gone down over the past year or so.

Faucher says Western Pennsylvania is benefiting from Marcellus Shale in terms of direct jobs as well as support industries such as manufacturing. He says Eastern Pennsylvania and the Philadelphia area are lagging behind.  He says the Harrisburg area is suffering because of the financial difficulties in the capital city as well as layoffs in state government.

Businesses in Pennsylvania are still pessimistic about the national outlook, but Faucher says that number is lower than it was in the fall. He says they see local conditions picking up before the national economy.