Small-Business Confidence Levels Rise, But Not Fast Enough
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Small businesses are marginally more confident than they have been, though the level of optimism as measured by the National Federation of Independent Businesses is still trending below historic norms.
The NFIB's Small Business Optimism Index rose 0.6 points in July, coming in at 94.1. There was good news in that number. It regained some of its losses when it sank in June, and the latest figure actually represents the index's fourth-highest reading since December 2007.
But, over the past 35 years, the NFIB notes the average for the index was 100.
"Unfortunately, nothing is being done to allay the most pressing concerns identified by job creators -- dealing with rising health insurance costs, regulations, tax complexity, energy costs and general economic uncertainty," said Bill Dunkelberg, NFIB's chief economist, in a release.
On the job front, small businesses surveyed generally said they aren't yet ready to add workers in a big way, with more saying they are shedding jobs than hiring. However, business owners also suggested it is difficult to find good candidates. Fifty percent of the owners surveyed hired or tried to hire in the last three months, but 40 percent reported few or no qualified applicants for open positions.
Twenty percent of all owners reported job openings they could not fill in the current period, which could point to positive employment down the line. But the NFIB survey confirmed that more companies are choosing temporary workers over permanent ones. Fifteen percent reported using temporary workers, up 3 points from June.
Sales growth continues to be small for most businesses, and many owners surveyed are not confident they will see sales increase in the near term.
But credit is easier to come by. Just 5 percent said their credit needs weren't met in July. That's the lowest reading since February 2008, according to the NFIB.