Global| Oct 14 2008U.S. Small Business Optimism Rose Further
by:Tom Moeller
|in:Economy in Brief
Summary
According to the National Federation of Independent Business (NFIB), small business optimism rose another 2.0% during September to the highest level since February. The rise to an index level of 91.1 added to a gain of 3.3% during [...]
According to the National Federation of Independent Business (NFIB), small business optimism rose another 2.0% during September to the highest level since February. The rise to an index level of 91.1 added to a gain of 3.3% during August.
During the last ten years there has been a 70% correlation between the level of the NFIB index and the two quarter change in real GDP.
The percent expecting the economy to improve rose again, last month to the highest level since late 2005.
The percentage planning to raise employment dipped slightly to 7%, still near the highest level since February. The percentage of respondents with one or more job openings improved to 18% which was the highest level since June. During the last ten years there has been a 71% correlation between the NFIB employment percentage and the y/y change in nonfarm payrolls.
The percentage of firms actually raising prices fell to 20%, the lowest level since April. During the last ten years there has been a 64% correlation between the y/y change in the producer price index and the level of the NFIB price index. The percentage of firms planning to raise prices also fell further to 24% which was the least since February.
The largest, single most important problems seen by business were poor sales (20%), inflation (16%), insurance cost and availability (10%) and taxes (17%). The latter, however, still was reduced from 27% in early 2007.
About 24 million businesses exist in the United States. Small business creates 80% of all new jobs in America.
The NFIB figures can be found in Haver's SURVEYS database.
The Federal Reserve and other central banks announce further measures to provide broad access to liquidity and funding to financial institutions. Visit the U.S. Federal Reserve site here for more info.
| Nat'l Federation of Independent Business | September | August | Y/Y | 2007 | 2006 | 2005 |
|---|---|---|---|---|---|---|
| Small Business Optimism Index (1986=100) | 92.9 | 91.1 | -4.5% | 96.7 | 98.9 | 101.6 |
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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