Global| Jan 10 2012U.S. Small Business Optimism Improves Further
by:Tom Moeller
|in:Economy in Brief
Summary
Small businesses are gaining more confidence in the economy. The National Federation of Independent Business indicated that its December index of small business optimism rose to 93.8 from an unrevised 92.0 in November. The latest [...]
Small businesses are gaining more confidence in the economy. The National Federation of Independent Business indicated that its December index of small business optimism rose to 93.8 from an unrevised 92.0 in November. The latest figure was the highest since last February. The percentage of firms feeling that now is a good time to expand the business was its highest since September, 2008. Also, improvement in firms' expectations for higher sales in six months rose to its highest since February while the reading for the economy was its best since May.
The job openings reading slipped m/m but remained near the highest of the economic recovery. The percentage of firms planning to increase employment also slipped m/m but was nearly the highest since October, 2008. The percentage of firms feeling that credit was harder to get fell to just 10%. Again, no firms, on balance, were raising prices, its lowest level since January. The percentage of firms planning to raise prices slipped to a low 14%.
The most important problems faced by small business were poor sales (23%, greatly reduced from two years ago), taxes (21%), government requirements (20%, the highest since 1996), insurance cost & availability (8%), competition from large businesses (7%), inflation (5%, a twelve-month low), quality of labor (5%), financial & interest rates (4%) and the cost of labor (3%).
Roughly 24 million small businesses exist in the U.S. and they create 80% of all new jobs. The NFIB figures can be found in Haver's SURVEYS database.
| National Federation of Independent Business | Dec | Nov | Oct | Dec'10 | 2011 | 2010 | 2009 |
|---|---|---|---|---|---|---|---|
| Small Business Optimism Index (SA,1986=100) | 93.8 | 92.0 | 90.2 | 92.6 | 91.4 | 89.9 | 86.7 |
| Firms Expecting Higher Real Sales In Six Months (Net %) | 9 | 4 | -4 | 8 | 3 | 1 | -11 |
| Firms Expecting Economy To Improve (Net %) | -8 | -12 | -16 | 9 | -9 | -1 | -0 |
| Firms With One or More Job Openings (Net %) | 15 | 16 | 13 | 13 | 14 | 10 | 9 |
| Firms Reporting That Credit Was Harder To Get (Net %) | 8 | 10 | 11 | 12 | 10 | 13 | 14 |
| Firms Raising Avg. Selling Prices (Net %) | 0 | 0 | -1 | -5 | 5 | -12 | -20 |
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
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