Tuesday, November 13, 2018

Small Business Optimism Index decreased in October

by Bill McBride on 11/13/2018 08:33:00 AM

CR Note: Most of this survey is noise, but there is some information, especially on the labor market and the "Single Most Important Problem".

From the National Federation of Independent Business (NFIB): October 2018 Report: Small Business Optimism Index

The Optimism Index shed a modest 0.5 points, with slight declines in five components, no change in four of them, and one increase, landing at 107.4.
..
Job creation was solid in October at a net addition of 0.15 workers per firm (including those making no change in employment), unchanged from September. Sixteen percent (up 3 points) reported increasing employment an average of 3.3 workers per firm and 11 percent (unchanged) reported reducing employment an average of 2.9 workers per firm (seasonally adjusted). Sixty percent reported hiring or trying to hire (down 1 point), but 53 percent (88 percent of those hiring or trying to hire) reported few or no qualified applicants for the positions they were trying to fill (unchanged). Twenty-three percent of owners cited the difficulty of finding qualified workers as their Single Most Important Business Problem (up 1 point), 2 points below the record high reached in August. Thirty-eight percent of all owners reported job openings they could not fill in the current period, equal to last month’s record high.

emphasis added
Small Business Optimism Index Click on graph for larger image.

This graph shows the small business optimism index since 1986.

The index decreased to 107.4 in October.

Note: Usually small business owners complain about taxes and regulations (currently 2nd and 3rd on the "Single Most Important Problem" list).  However, during the recession, "poor sales" was the top problem. Now the difficulty of finding qualified workers is the top problem.