Small businesses are facing the most difficult business climate in three years, Chicago Breaking Business reported based on a report released today.

Among the most troubling signs: Four out of every 10 small business owners are unable to secure adequate financing, according to the National Small Business Association’s mid-year economic report.

Indeed, it has been 17 years since this many small businesses have had such a difficult time getting loans, said Todd McCracken, president of the Washington D.C.-based organization.

“Given the direct correlation between access to capital and job growth, unless small-business owners are able to secure financing, we will continue to see high unemployment, ” said McCracken.

In the last 12 months, 11 percent of small businesses hired workers and 25 percent cut jobs, the report said.

Six months ago, the organization measured a slight increase in optimism among small business owners. But in the latest survey, conducted among 400 small business owners between June 23 and July 14, nearly every indicator fell including business confidence, revenue, job growth and growth projections.

“These traditionally-upbeat entrepreneurs have a far-more negative outlook today than they have in the last several years,” the report said. Nearly half do not believe there will be any growth opportunities for their business in the coming year and 41 percent have concerns about the ongoing viability of their business.

Likewise, 59 percent of small-business owners expect the U.S. economy to remain flat this year and 29 percent anticipate a recession.