NFIB Small Business Optimism – June 2013

The June NFIB Small Business Optimism report was released yesterday, June 11.  The headline of the Press Release is “Small-Business Confidence Edges Up, Reaches May 2012 Level.”  The subtitle is “Not Much Progress For a Recovery.”

The Index of Small Business Optimism increased 2.3 points in May to 94.4.

Here are some excerpts from the Press Release that I find particularly notable (but don’t necessarily agree with) :

While May’s reading is the second highest since the recession started December 2007, the Index does not signal strong economic growth for the sector.

also:

Owners were asked to identify their top business problem: 24 percent cited taxes, 23 percent cited regulations and red tape, 16 percent cited weak sales and 2 percent reported financing/access to credit.

also:

Sales. The net percent of all owners* reporting higher nominal sales in the past three months compared to the prior three months was unchanged at a negative 4 percent. While this is the best reading in nearly a year, there are still more firms reporting declines than gains. The net percent of owners expecting higher real sales volumes rose 4 points to 8 percent of all owners. Sales expectations are trending better, but are still historically weak.

also:

Credit Markets. Credit continues to be a non-issue for small employers, only 5  percent of whom say that all their credit needs were not met in May. This is down 1 point from April and the lowest reading since February 2008. Twenty-eight (28) percent of owners surveyed reported that all their credit needs were met last month, and 53 percent explicitly said they did not want a loan (67 percent including those who did not answer the question, presumably uninterested in borrowing as well).

also:

 Inflation. The net percent of owners raising selling prices in May was 2 percent, down 1 point from April. Sixteen (16) percent of NFIB owners reported reducing their average selling prices in the past three months, and increase of 1 point, and 19 percent of owners surveyed reported price increases (down 1 point). As for prospective price increases, 17 percent of small employers plan to raise average prices in the next few months (down 4 points), and 3 percent plan price reductions. Seasonally adjusted, a net 15 percent plan price hikes, down 3 points.

Here is a chart of the NFIB Small Business Optimism chart, as seen in Doug Short’s June 11 post titled “Small Business Sentiment:  Highest Level Since May 2012” :

(click on chart to enlarge image)

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Further details regarding small business conditions can be seen in the Small Business Economic Trends document as well as the June 2013 NFIB Small Business Economic Trends report (pdf).

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The Special Note summarizes my overall thoughts about our economic situation

SPX at 1626.13 as this post is written