The NFIB Small Business Optimism Index increased 1.3 points in July to 95.4, after falling 4 points in June. Seven of the ten components posted gains over the last month.
The number of owners planning to increase employment rose 3 points from June. Fifty-seven percent of owners reported hiring or trying to hire, while 48 percent reported few or no qualified applicants for the positions they were trying to fill – a 4 percent increase from June.
Capital spending increased, as 61 percent reported capital outlays – a 7 point gain over the last two months. Only 24 percent of owners are planning capital outlays in the next 3 to 6 months, as owners expect for a continuation of economic “under-performance.”
The earnings trends index fell 2 points on the month after dropping 10 points in June. The net portion of owners reporting higher earnings fell to a negative 19 percent, while reports of increased labor compensation rose 2 points to a net 23 percent.
Credit conditions continued to be satisfactory for small business owners; just 4 percent of owners reported that their borrowing needs were not met, down 1 percent from the previous month. Financing and interest rates were the least cited concern, consistent with the previous month. Taxes were the single most important problem cited by owners, followed closely by government requirements and red tape.
Read the NFIB release.
