U.S. economy worsening, small business survey says

CHICAGO, Sept 29 (Reuters) - Three out of four owners of small businesses say the U.S. economy is getting worse, that it is harder to get loans and that the economic environment had reduced the amount of money they take home, according to a survey released on Monday.

The Discover Small Business Watch also found that the economy was the top issue on the minds of small business owners ahead of the upcoming U.S. presidential elections in November and the Discover Small Business Watch index of economic confidence fell 12.3 points to 74.6 in September, its second lowest level since the survey was launched in August 2006.

Throughout this year small business owners have increasingly expressed dissatisfaction over the performance of the world's largest economy.

"This is further evidence that we are in a prolonged period where small business owners feel the economy is not getting any better," said Ryan Scully, director of the Discover business credit card.

In the survey, 73 percent of respondents said economic conditions in the United States were getting worse compared with just 8 percent who said they were getting better.

Seventy-two percent of respondents said it had become harder to borrow money, compared with 8 percent who said it had become easier. Also 72 percent said they had been forced to take home less money compared with 21 percent who said they had not.

"American business owners are full of independent spirit and do whatever it takes to stay afloat," Scully said. "Right now they're having a hard time doing that."

Fifty-two percent of respondents said the economy was the most important issue for them ahead of the presidential elections, compared with 11 percent who said national security and 10 percent who cited the war in Iraq. (Reporting by Nick Carey, editing by Carol Bishopric)