The latest issue of the NFIB Small Business Economic Trends is out today. The update for September came in at 96.1, only a 0.2 point increase from the previous month. The index remains at the 29th percentile in this series.
Nevertheless, today’s number came in above the Investing.com forecast for a 0.3 point decline to 95.6.
Here is the opening summary of the news release.
“Small business optimism continues to be stagnant, which is consistent with the expected economic growth of about 2.5 percent. The percent of owners citing the difficulty of finding qualified workers as their Most Important Business Problem increased and is now third on the list behind taxes and regulations. This is the highest reading since 2007 and suggests that employers will continue to face wage pressure in order to attract and keep good employees.” —Bill Dunkelberg, NFIB Chief Economist
The first chart below highlights the 1986 baseline level of 100 and includes some labels to help us visualize that dramatic change in small-business sentiment that accompanied the Great Financial Crisis. Compare, for example the relative resilience of the index during the 2000-2003 collapse of the Tech Bubble with the far weaker readings following the Great Recession that ended in June 2009.
The average monthly change in this indicator is 1.3 points. To smooth out the noise of volatility, here is a 3-month moving average of the Optimism Index along with the monthly values, shown as dots.
Here are some excerpts from the report.
Labor Markets
Overall, a solid improvement in hiring activity. There was no evidence in the NFIB data that job creation slacked off sharply from June and July, each with 245,000 jobs. Reported job creation returned to its best level of the year, with owners adding a net 0.18 workers per firm in recent months, up 0.05 from August.
Credit Markets
Has the Fed’s zero interest rate policy and quantitative easing had a positive impact on Small Businesses?
