A new survey of small-business owners shows growing optimism about sales and hiring in the next six months, although the economy as a whole continues to be a source of worry.

A new survey of small-business owners shows growing optimism about sales and hiring in the next six months, although the economy as a whole continues to be a source of worry.

PNC Financial Services Group’s spring survey spring survey of small- and middle-market business owners showed that 47 percent of businesses surveyed expect increases in sales in the next six months, and 37 percent felt profits would increase.

But pessimism about the national economy rose since the fall survey, results PNC senior economist Craig Thomas called “perplexing.”

“Their situation, as they see it, and what they are expecting, is getting better,” he said. “(But) when we (conducted the survey), we were amid the rancor of the health care debate and there was a lot of negativity being spoken about the economy and its prospects. That, combined with the fact that jobs are slower to come around than other indicators, could explain the results.”

The health care bill was on the minds of several business owners whom PNC contacted for the survey.

Donald Barnes, owner of Belvidere (Ill.) Auto Maintenance, said he’s concerned about the effect the health care bill will have on his business, which employs four. Barnes said this year’s sales are up compared to the same time last year, although his car count is down.

“Honestly, I think it’s too early to say,” he said of his predictions for the next six months. “I’m trying to be optimistic, but having gone through everything we have, it’s tough.”

Barnes is seeing some troubling signs that business may never be as strong as it used to be. He sent out about 2,000 coupons to his customers earlier this year. About 300 were returned because the customer had moved and not left a forwarding address.

“That’s a little disheartening,” he said. “You work so hard to get your customer base, (then) watch so many go away.”

In South Beloit, Ill., machining company Meadoweld Inc. has laid off all its employees and is staffing what little work it has, mostly repairs, through contract and temporary services.

“I’m trying to align myself through this bad economy,” owner Casey Meadows said. “This is the worst I’ve seen it in the last 15 years. I’m doing whatever we can to survive.”

He doesn’t see much work coming up in the next six months, at least not enough to convince him that full-time workers will be a necessity again. And he’ll think twice about hiring in light of what he fears will be burdensome health care taxes.

“I’m just trying to feel my way along,” he said.

Reach Rockford Register Star staff writer Sean F. Driscoll at 815-987-1346 or sdriscoll@rrstar.com.