Small Business Euphoric About Trump As Optimism Soars To 34 Year High

The May Small Business Optimism Index increased to the second highest level in the NFIB survey's 45-year history, rising to 107.8 from 104.8, the highest level in 34 years, with small businesses reporting high numbers in several key areas including compensation, profits, and sales trends amid euphoria over Trump's economic, fiscal and tax policies .

“Main Street optimism is on a stratospheric trajectory thanks to recent tax cuts and regulatory changes. For years, owners have continuously signaled that when taxes and regulations ease, earnings and employee compensation increase,” said NFIB President and CEO Juanita Duggan

The May report hit several records:

  • Compensation increases hit a 45-year high at a record net 35 percent.
  • Positive earnings trends reached a survey high at a net three percent.
  • Positive sales trends are at the highest level since 1995.
  • Expansion plans are the most robust in survey history.

Reports of higher worker compensation pushed 2 points higher to a record net 35 percent of all firms.

The frequency of reports of positive profit trends improved 4 percentage points to a net 3 percent reporting quarter on quarter profit improvements, the best reading in the survey’s 45 year history as "the new tax law and the strong economy are very supportive of profit improvements."

In another interesting marker, a net 19 percent of small business owners are planning price increases, the highest since 2008 and a signal of a strong economy. A net three percent reported positive profit trends, up four points and the best reading in the survey’s history. In addition, a net 15 percent reported higher nominal sales in the past three months, up an astonishing seven points and the sixth consecutive strong month for sales.

“Small business owners are continuing an 18-month streak of unprecedented optimism which is leading to more hiring and raising wages,” said NFIB Chief Economist Bill Dunkelberg. “While they continue to face challenges in hiring qualified workers, they now have more resources to commit to attracting candidates.”

Small business owners continue to hire with a seasonally-adjusted net 18 percent planning to create new jobs. Twenty-nine percent of owners have job openings for skilled workers, the third highest reading since 2000. Twelve percent have job openings for unskilled workers, with the strongest demand in the transportation, travel, communications, utilities sector. To compete in the job market, 35 percent of owners reported increases in labor compensation to attract job applicants.

The percentage of owners reporting capital outlays moved up one point to 62 percent, with 47 percent reporting spending on new equipment, 24 percent acquiring vehicles, and 16 percent improving expanded facilities. Thirty percent plan capital outlays in the next few months.

Access to credit continues as a non-issue with 37 percent of owners reporting all credit needs were satisfied and 43 percent saying they were not interested in a loan, down seven points from last month and the lowest reading since 2007. Only one percent reported that financing was their top business problem. Owners planning to build inventories rose three points to a net four percent, the nineteenth positive reading in the past 20 months.

As reported in NFIB’s May jobs report, 23 percent of owners cited the difficulty of finding qualified workers as their Single Most Important Business Problem, followed by taxes at 17 percent and regulations at 13 percent. Fifty-eight percent reported hiring or trying to hire, up one point from last month but 83 percent of those reported few or no qualified workers.

Click here to view the full NFIB Small Business Economic Trends report

Comments

GoFuqYourself Tue, 06/12/2018 - 07:11 Permalink

"a net 19 percent of small business owners are planning price increases, the highest since 2008 and a signal of a strong economy"

 

And I thought that was called inflation.

Endgame Napoleon GoFuqYourself Tue, 06/12/2018 - 07:57 Permalink

Having been a Main Street business owner—literally Main Street—I call BS on the problems-finding-skilled-labor issue. Many, many, many Main Street businesses, in fact, staff with teenagers or immediate & extended family members, with the mommies among them granted extensive absenteeism privileges, just like in the call centers and back offices of the corporate world, albeit this type of absenteeism is “family friendly” in a more informal manner. 

In reply to by GoFuqYourself

Vilfredo Pareto Endgame Napoleon Tue, 06/12/2018 - 08:02 Permalink

Yeah.  That is how micro businesses operate.  It appears hard to find skilled labor or even reliable labor at current price points which isn't a bad thing.  Price is signalling higher demand and if the economy is allowed to operate freely (for the first time since the 19th century lol) then supply will start increasing too.  Fortunately I don't need skilled labor.  Wifey, FWB, and child labor is good enough for me.

In reply to by Endgame Napoleon

Vilfredo Pareto MARDUKTA Tue, 06/12/2018 - 07:57 Permalink

Trump has set the tone that has caused the bureaucrats to pull their punches against small business and has emboldened small business and independent contractors.  You never know when some gooberment parasite causing problems will get lynched now in the current political climate, so anecdotally I see the parasites being a bit more careful

In reply to by MARDUKTA

Endgame Napoleon MARDUKTA Tue, 06/12/2018 - 08:22 Permalink

Field Report:

I have been looking at the job ads all over the country, trying to find out if ANY state has 1) affordable rent and 2) job offerings substantial enough to cover housing for a childless, single woman with no spousal income, no child support to beef up wages and no layers of monthly welfare to cover rent, groceries and other major bills when working part time as a single-earner parent, staying under the income limits for the programs, plus refundable child tax credits up to $6,431. 

I am seeing the same $10 to $12-per-hour jobs, including when positions purport to require a degree, licenses and years of experience, all of which I have. Granted, when such job requirements are listed—after jumping through a bunch of useless hoops—I very, very often find out that employers staff mostly (or exclusively) non-licensed, non-degree-holding moms with “somethin’ comin’ in’” from spouses, exes or government that bumps up their wages to a livable level. 

These ads are also vague in terms of whether the advertised job is full time, part time or staffed by a temporary agency and constantly reposted on the job boards, month after month. This intentional vagueness applies to many of the corporate job ads and the job ads for positions in smaller offices.

It appears that employers still want employees-in-name-only whose main sources of household income are unearned and fall outside of their wages, and it appears that employers are still staffing for churn jobs. 

Same as it ever was.

One lagging indicator is neighborhoods in affluent areas, which still sport multiple cars per house, indicating that single, non-womb-productive, non-welfare-eligible, grown children are still unable to afford rent that soaks up more than half of their monthly, earned-only income from churn jobs and from any absenteeism-gang mom-dominated jobs that they might get & hold briefly. It likewise signals that people are renting in big groups of unattached, post-college roommates.

In reply to by MARDUKTA

Last of the Mi… Tue, 06/12/2018 - 07:35 Permalink

Hopefully Wally worlds war on small business and anyone underneath them with their encouragement politically of massive and restrictive regulations is done. The masters have done this for decades with the culmination of Obamacare. It will take a while to take the damn thing apart but the effects are beginning to be felt. 

JGC Tue, 06/12/2018 - 07:40 Permalink

Clearly, the strength in the small business survey (along with current quarter estimates of GDP growth) flies in the face of the narrowing market yield curve. History shows that the market yield curve gets it predictive power when it is linked to the economy's yield curve (or the spread between nominal GDP growth and fed funds). Today, the economy's yield curve is steepening. The Fed is following the wrong yield curve. Stay tuned.

Vilfredo Pareto Tue, 06/12/2018 - 07:53 Permalink

Small business is fragile without easy access to cheap capital like big business.  Of course they are euphoric.   It is open season on the fucking bureaucrats who try to kill us off and burden us with excessive regulations.  I have noticed a bit more circumspection among the parasite class.

 

Have you slapped a bureaucrat today?

brushhog Tue, 06/12/2018 - 07:55 Permalink

At this point its getting very hard to deny Trump's effectiveness. His staunchest critics are sounding more hollow and their criticism seem motivated by nothing more than pointless hatred.

Pernicious Gol… Tue, 06/12/2018 - 08:23 Permalink

Was speaking last night with a friend who sells high-end luxury items. Business is booming like never before. He wants to retire but feels he can't disappoint all the people wanting to throw money at him.

Yes, he credits President Trump.

roddy6667 Tue, 06/12/2018 - 08:30 Permalink

Small business optimism is an emotion. It's not real. It does not change the facts. Somebody bought all the fake numbers the government is pumping out and they feel better. That's all.

Let it Go Tue, 06/12/2018 - 08:36 Permalink

I love these kind of stories, however, the fact is that owning a small business is hard and most people are not up to the task. We should not underestimate the role new government regulations or Amazon's exploitation of brick and mortar stores have played in undermining the success of these businesses.

Small business failures should receive a lot more attention then they do. When a business fails contracts often go unfulfilled, bills are not paid, suppliers must take write-offs, and landlords after only a few months rent can get back buildings altered in negative ways. More on the cost of small business failures in the article below.

 http://Small Business Failures Merit More Attention .html

JelloBeyonce Tue, 06/12/2018 - 08:46 Permalink

It's often not about what IS being said, but what's NOT being said.

You can often tell how bad the economy really is by the amount good "news" (aka spin) that is being pushed through.

 

The NFIB's largest campaign "contributions" went to the Republican party committees.  
 

REVOLVING DOOR

16 out of 21 National Fedn of Independent Business lobbyists in 2016-2017 have previously held government jobs

 

Note:  I am neither partial to Democraps nor Republicunts, just interested in where the money comes from, goes, and what it pays for.....like positive PR (aka "news").

1033eruth Tue, 06/12/2018 - 09:10 Permalink

HA - you know WHY they are euphoric?  As small business owners, they are married to the business and have no time to keep informed.  The ONLY thing they have time for, is running the business.  They barely have time to wipe their ass much less notice all the clues being dropped in the back pages of the MSM or on alternative news programs.

MusicIsYou 1033eruth Tue, 06/12/2018 - 09:46 Permalink

And business owners are busy working hard so they can be lazy when they're 60 laying on the beach sipping margaritas while somebody else gets paid shit operating the business later. So basically business owners really are lazy entitlement minded people not unlike welfare people, and that lazy business owner doesn't analyze Trump thoroughly, well because they're lazy. And don't tell me business owners aren't lazy, because the very interpretation of what they do - is to work hard so they can be lazy later.

In reply to by 1033eruth

MusicIsYou Tue, 06/12/2018 - 09:16 Permalink

Yeah business's taxes are going to be at 34 year highs too. Somebody has to pay for all the government economic stimulus, and it won't be the people making $35,000 per year. It will have to be the people making $35k per day or per week.

gwar5 Tue, 06/12/2018 - 09:38 Permalink

More winning...

Small businesses hire most workers and are the backbone of American society. If you really want to create jobs you have to help the small businesses.

Obama conducted a war against small business. Socialists despise small businesses because they teach independence and entrepreneurship. That's where you get your first job and learn how to be independent.

...more winning please.

 

Dan'l Tue, 06/12/2018 - 12:23 Permalink

Everything is so great that wages are still declining. 94% of tax savings by public companies will be used to buy back their stock and not give any meaningful raises to their employees. The destruction of the middle class goes on.

Honest Sam Tue, 06/12/2018 - 13:23 Permalink

This was hilary rodman's worst nightmare:

"Similarly, the attitude from Hillary's central-planning squad was that small-business owners could toss in the towel if they couldn't pay the price of providing the government's newly mandated benefits for 100 percent of their employees.

"I can't be responsible for every undercapitalized entrepreneur in America," Mrs. Clinton said in 1993, responding to charges that her plan would bankrupt businesses and cut employment. Destroy a job through excessive health mandates, she was told, and employees will go from having no health insurance to having no health insurance and no jobs.

No one, of course, was asking Hillary Clinton to be "responsible for every undercapitalized entrepreneur in America." Just the opposite: It was her plan that would cause the undercapitalization.

The anti-business message was clear. Go out of business if you can't jump through Hillary's hoops. A business is a throwaway if it can't come up with the money to pay for the latest mandate.

The nation's response was equally clear. In November 1994, the Republicans won control of both houses of Congress for the first time in 40 years."

 

Roll in it, you bitch.