Though overall business optimism has appeared to remain on a small upswing or at least level, that of small businesses continues to wane as the slow economic recovery has repeatedly failed to demonstrate signs of a quick acceleration. Meanwhile, some of those same small business owners take issue with more recent mainstream media and analysts’ suggestions that credit has been easier to come by for companies.
This week, the National Federation of Independent Business’ (NFIB) Small Business Optimism Index slipped for the third straight month in May by a slight 0.3 points. NFIB characterized the present index reading (90.9) as that of a ‘recessional-level reading.”
The results corresponded with the decline found in the Wells Fargo/Gallup Small Business Index for the first-quarter, released earlier this spring, which found small business owners positions shifting from slightly-to-moderately positive to neutral.
Wells Fargo followed that up this week with a report that small businesses still are finding it exceedingly difficult to access credit with any kind of favorable, or even perceivably fair, terms. The firm’s study found that at least 30% of responding company representatives found credit hard to come by during the last year, and 36% believe it will be increasingly difficult to do so. Despite economic growth, albeit tepid, conditions changed little in the Wells Fargo study from the first-quarter to the second-quarter. The peak in actual difficulty was slightly more than 35%, reported in Q1 2010, according to Wells Fargo statistics.
Businesses did, however, get at least one piece of somewhat good news this week…sort of. The Producer Price Index (PPI) statistics for May showed a 0.9% increase, mostly tied to increases in food and energy costs. The good news was that experts had expected the PPI to increase at a much higher rate.
Brian Shappell, NACM staff writer