Small Business Outlook Slightly Better

Originally published by: Calculated RiskOctober 11, 2011

The following article was produced and published by the source linked to above, who is solely responsible for its content. SBC Magazine is publishing this story to raise awareness of information publicly available online and does not verify the accuracy of the author’s claims. As a consequence, SBC cannot vouch for the validity of any facts, claims or opinions made in the article.

From the National Federation of Independent Business (NFIB): Small-Business Confidence Sees Modest Gain: The Start of a Trend, or a Blip?

Small-business optimism gained 0.8 points in September, according to the National Federation of Independent Business’ (NFIB’s) latest Index, ending a six-month decline. However, NFIB’s chief economist cautions that in spite of this uptick, there is little among the 10 Index components that can be considered  “positive.”

Note: Small businesses have a larger percentage of real estate and retail related companies than the overall economy.

The first graph shows the small business optimism index since 1986. The index increased to 88.9 in September from 88.1 in August. Optimism had declined for six consecutive months and this is just a small increase.

The second graph shows the net hiring plans for the next three months. Hiring plans were still low in September, but still positive and the trend is up.

According to NFIB: “Over the next three months, 11 percent plan to increase employment (unchanged), and 12 percent plan to reduce their workforce (unchanged), yielding a seasonally adjusted 4 percent of owners planning to create new jobs, also down 1 point from August."

Twenty eight percent of small business owners reported that weak sales continued to be their top business problem in September.

In good times, owners usually report taxes and regulation as their biggest problems.

The optimism index declined sharply in August due to the debt ceiling debate and only rebounded modestly in September. This index has been slow to recover - probably due to a combination of the recent economic weakness, and also the high concentration of real estate related companies in the index.

Check out this extra section in each digital issue of SBC Magazine for additional news, perspective, and advertiser content. Learn more and access 2016-2017 archives here.