DO I NEED TO PAY SUBCONTRACTOR FOR WORK?

After all, he was only seeking $50,000, has been in business for 11 years and takes in more than $1 million in annual revenue.

In February and March, West reached out to three lenders he had previously gotten financing from, including one where he has an existing line of credit. To his surprise, he was rejected.

“I feel like it’s really weird, it’s such a small amount of money for a business that has so much ongoing, sustained revenue and has been in the same community for a long time,” he said.

West isn’t alone. Borrowing for small businesses was already constrained due to rising interest rates. Following the recent collapse of Silicon Valley Bank and Signature Bank, some lenders — particularly the small and midsize banks that serve small businesses — may be forced to tighten credit further, since they’re seeing an outflow of deposits, which means they need to retain capital. And banks are being more cautious in general due to uncertainty about the economy.

“It’s hard to read how severe this is going to be, but it’s certainly going to be significant, and when you look at how things play out, small businesses are hit the hardest,” said Ray Keating, chief economist for the Small Business & Entrepreneurship Council.

According to the latest Biz2Credit Small Business Lending Index released in February, the approval rates of small business loan requests at big banks have fallen for nine consecutive months. The larger banks approved just 14.2% of applications in February, down from 28.3% in February 2020. Small banks granted about 20% of loan applications this February, but they were approving about half of all requests back in early 2020, before the pandemic hit.

An overall tightening of credit will help slow down the economy and ease inflation, which is what the Federal Reserve hopes to achieve by hiking interest rates, said Rohit Arora, CEO and co-founder of

In 2023 alone, there have been over 118,000 U.S. tech layoffs, according to Crunchbase News, a business publication. That’s in addition to two major bank collapses and two federal rate hikes. The class of 2023 will graduate into this economic upheaval while facing another variable: student loan payments.

This can be an overwhelming and confusing time for those set to begin repayment of student debt, says Barry Coleman, vice president of program management and education at the National Foundation for Credit Counseling. Coleman cites the expected end of a three-year pause on federal student loan payments, legal challenges to federal student debt relief programs and the potential impact of inflation on the job market as reasons new graduates could feel uneasy.

But new grads don’t need to panic. Here’s how they can weather a potential recession and the financial uncertainty that might come with it.

Understanding your student debt is one of the best strategies to stay on top of your loans, regardless of how the economy is performing, says Betsy Mayotte, founder of The Institute of Student Loan Advisors.

There is typically a six-month grace period after graduation before you’re required to make your first student loan payment. Before this first payment is due,