Optimism continues apace among small business owners, continuing a streak that started shortly after the U.S. presidential election. The Index of Small Business Optimism from the National Federation of Independent Business (NFIB) rose 1.6 points to 105.2 in July, with seven of the 10 components in the index posting a gain, two declining and one unchanged. Stronger consumer demand was apparently the key, which was a major contributor to growth in the second quarter of 2017, according to the NFIB.
“There’s nothing like more customers to make owners happy, and optimism held up, as did important measures of spending and hiring plans,” the NFIB said.
A seasonally adjusted net 19% of small business owners plan to create new jobs, an increase of four points, with higher levels not seen since December 1999. A full 60% reported hiring or trying to hire, though more than half said that they were finding few or no qualified applicants for their open positions. Finding qualified workers was a particular problem in construction and manufacturing.
"The number of owners trying to fill positions and create new jobs is very high," said Bill Dunkelberg, NFIB chief economist. "That's good news for workers, because they can command higher wages and better benefits. The bad news is that small business employers are finding it very hard to hire and keep their workers."
An unchanged 57% reported capital outlays, with spending on new equipment, vehicles, and improved or expanded facilities. Five percent acquired new buildings or land for expansion.
Among small business owners, 3% said that all their borrowing needs were not satisfied, which is a decrease of 1 point and a low reading, historically. About 31% reported that all credit needs were met and just over half said that they were not interested in a loan. Only 2% said that financing was their top business problem.
– Adam Fusco, associate editor