The National Federation of Independent Business released their Small Business survey today which showed a small gain from 90.2 to 92.
“After so many months of pessimism, November’s modest gain made it feel like spring, again,” said NFIB Chief Economist Bill Dunkelberg. Bill is right as the last time that the index was at this level was in March of this year. However, it still remains below where it was in January or February.
“Still, our current reality is still very much the ongoing economic winter. November’s reading is still well below the average reading prior to 2008 levels from previous recoveries.”
According the November’s survey, the percent of owners reporting “poor sales” as the top problem remained stubbornly high at 25 percent followed by 19 percent reporting both taxes and regulations. These concerns do not provide confidence for employers to expand, hire and manufacturer other than just enough to meet demand. This in turn keeps a lid on economic growth as consumers need jobs first so that they can produce something in order to get paid. Then, and only then, can consumption increase and create lasting organic economic growth.
This was reflected in the release: “The net percent of owners expecting better business conditions in six months was a negative 12 percent, 4 points better than October, but still 22 percentage points below January’s reading.”
Mind the gap!