NFIB Small Business Optimism Index Ticks Up In February

Date: March 11, 2015

Reading Is Third Highest Since Early 2007

NFIB announced Tuesday that its Small Business Optimism Index increased to 98.0 in February, a slight gain from 97.9 in January. While the reading was below analysts’ predictions, it is the third-highest since early 2007, behind only November and December 2014.

Among the ten components comprising the index, owners reporting hard-to-fill job openings gained the most, adding three points to a nine-year high of 29 percent, with 14 percent citing the availability of qualified labor as their top business problem. Meanwhile, the number of businesses planning to create new jobs fell two points to 12 percent, inventory investment plans rose two points to four percent, and capital spending plans were flat at 26 percent.

 

What This Means For Small Business:

NFIB Chief economist Bill Dunkelberg was upbeat about the results, saying, “In spite of slow economic activity and awful weather in a lot of the country, small business owners are finding reasons to hire and spend, which is great news.”

 

Noting that the small business sector historically produces about half the private GDP and employs half of the private sector workforce, Dunkelberg said, “During the recovery, this sector did not pull its historic weight, slowing the recovery in employment substantially,” adding, “Huge numbers of firms and their jobs were lost in the recession, nearly 900,000 establishments in each of the years 2008 and 2009. The NFIB data suggest that the surviving firms are regaining stride and the Bureau of Labor Statistics data now show more starts than terminations, supporting job growth.”

 

Additional Reading:

Bloomberg News, Reuters, Investing, IFA Magazine, Truckinginfo, and 24/7 Wall Street (NY) report on the index.

View the NFIB FEBRUARY 2015 Report:Small Business Optimism Rises Despite Falling Sales Trends 2015.

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