The NFIB Small Business Optimism Index rose 3.5 points in May to 94.4, a strong improvement from April’s 90.9 reading. Owners are optimistic about future business conditions and expect the recession to be short-lived as the country re-opens.
A seasonally-adjusted net 8.0% of owners plan to create new jobs, up 5 points. Eight percent of owners, not seasonally adjusted, plan to increase total employment at their firm (up 7 points).
The percent of owners thinking it’s a good time to expand rose 2 points to 5.0%, driven in part by PPP’s forgiveness eligibility requirements and plans to re-hire workers as stay-at-home orders end. Forty-four percent of respondents reported hiring or trying to hire, but 37.0% (84.0% of those hiring or trying to hire) reported few or no “qualified” applicants for their positions. Twenty-three percent of all owners reported job openings they could not fill in the current period, down 1 point since April.
A net negative 19.0% of all owners reported higher nominal sales in the past three months, down 8 points from April. The net percent of owners expecting higher real sales volumes improved 18 points to a net negative 24 .0% of owners. After a historic 61-point drop over in March and April, some owners are expecting higher sales with business re-openings.
Three percent of owners reported that their borrowing needs were not fully satisfied, down 2 points. Thirty-three percent reported all credit needs met (unchanged) and 52.0% said they were not interested in a loan (down 4 points). A net 2.0% reported their last loan was harder to get than in previous attempts (down 2 points).
Read the NFIB report.