| Actual | Previous | |
|---|---|---|
| Index | 91.5 | 91.2 |
Highlights
The NFIB small business optimism index is essentially unchanged at 91.5 in September after 91.2 in August, and somewhat higher than 90.8 in September 2023. The NFIB said the index remains below the 50-year average of 98 for the thirty-third month in a row. If the optimism index is much the same, the uncertainty index is significantly higher at a record 103 in September, up 11 points from the prior month. If economic conditions are seen broadly as much the same in September as the prior month, risks to the economy are perceived as heightened, likely related to a contentious political climate around the presidential election at home and geopolitical developments abroad.
Among index components in September 5 are higher, three are lower, and two are unchanged. There is a 9-point jump in expectations for higher sales to minus 9 percent that erases the decline in the prior month. The larges moves lower are decreases of 6 points to 34 percent in current jobs and 5 points to 19 percent in capital expenditure plans.
In September 23 percent of survey respondents see inflation as their single most important problem, followed by 17 percent citing the quality of labor. While small businesses remain focused on their costs, there is less problem in finding people with the right skills and/or experience to hire.
Among index components in September 5 are higher, three are lower, and two are unchanged. There is a 9-point jump in expectations for higher sales to minus 9 percent that erases the decline in the prior month. The larges moves lower are decreases of 6 points to 34 percent in current jobs and 5 points to 19 percent in capital expenditure plans.
In September 23 percent of survey respondents see inflation as their single most important problem, followed by 17 percent citing the quality of labor. While small businesses remain focused on their costs, there is less problem in finding people with the right skills and/or experience to hire.
Definition
The small business optimism index is compiled from a survey that is conducted each month by the National Federation of Independent Business (NFIB) of its members. The index is a composite of 10 seasonally adjusted components based on the following questions: plans to increase employment, plans to make capital outlays, plans to increase inventories, expect economy to improve, expect real sales higher, current inventory, current job openings, expected credit conditions, now a good time to expand, and earnings trend.
Description
Small businesses are responsible for a majority of new job creation and the NFIB focuses on this sector of the economy. The direction of the health of small businesses can portend changes in the stock market - especially small caps.
