The October NFIB Small Business Optimism was released November 8. The headline of the Press Release is “Small Business Optimism Has Minor Uptick: Optimism Index Slight Uptick Still Weighed Down by Dominant Negative Forecast.”
The Index of Small Business Optimism increased 1.3 points in October, rising to 90.2.
Here are some excerpts from the report that I find particularly notable:
“Consumer sentiment remains at very low levels and is reflected in the 26 percent of small business owners who cite ‘poor sales’ as their biggest problem,” said NFIB Chief Economist Bill Dunkelberg. “There is no exuberance in spending, as consumers ‘make do’ rather than spend their increased savings in upgrades or new purchases. It’s that extra spending that would provide small business owners a reason to hire and order more inventory, the best stimulus we could have. But confidence is the key and right now there isn’t much."
October’s survey shows that optimism improved a smidge, but mostly because the outlook for business conditions and real sales growth became less negative. However, these two Index components are still solidly negative and at recession levels.
Four percent of owners reported financing as their most important business problem. So, for the overwhelming majority, credit availability is not a significant problem. Ninety-one percent reported that all their credit needs were met or that they were not interested in borrowing. Nine percent reported that not all of their credit needs were satisfied, the record low is 4 percent reached in 2000.
In conjunction with this October NFIB Small Business Optimism Survey, the CalculatedRisk blog on November 8 (in a post titled “NFIB: Small Business Optimism Index increases slightly in October") had three charts that depicted various facets (the Index itself; Hiring Plans and Poor Sales) of the Survey, as shown below:
(click on charts to enlarge images)
The Special Note summarizes my overall thoughts about our economic situation
SPX at 1243.70 as this post is written