Small business optimism remains historically low in September
Washington DC (October 8, 2024) – NFIB Small Business Optimism Index In September, it rose 0.3 points to 91.5. this is 33rd The Uncertainty Index rose 11 points to 103, a record high. Fifty-one percent of owners reported capital expenditures in the past six months, down five points from August. Meanwhile, the number of owners reporting inventory increases fell by 4 percentage points to a net negative 13% (seasonally adjusted), the lowest level since June 2020.
“Small and medium-sized business owners are feeling more anxious than ever,” he said. Bill Dunkelberg, NFIB Chief Economist. “Uncertainty has made owners hesitant to invest in capital and inventory, especially as inflation and financing costs continue to weigh on profits.While some hope remains for the holiday season, , many Main Street owners have doubts about whether their future business conditions will improve.
Key findings include:
- The net percentage of owners reporting inventory increases fell 4 points to a net negative 13% (seasonally adjusted), the lowest since June 2020.
- The average interest rate paid on short-term loans was 10.1%, up 0.6 points from August. The last time it was this high was in February 2001.
- 34% of all business owners (seasonally adjusted) said they had jobs they were unable to fill this fiscal year, a decrease of 6 points from August and the lowest level since January 2021.
- A net 12% of owners said they paid a higher interest rate on their most recent loan, down 3 percentage points from August and the lowest level since March 2022.
- Fifty-one percent reported making capital investments in the past six months, down five points from August. The last time it was this low was in July 2022.
- On a seasonally adjusted basis, a net 32% reported compensation increases, down 1 percentage point from August and the lowest level since April 2021.
- 23% of owners say inflation (increasing input costs and labor costs) is the single most important issue in running their business, down one point from August but still the top issue. there were.
As reported in NFIB’s Monthly Employment Report, a seasonally adjusted 34% of all small business owners say they have unfilled jobs this quarter, down 6 percentage points from August. This was the lowest level since January 2021. Or if you’re looking to hire in September, 90% reported that there were few or no qualified applicants for the position they were hiring.
Fifty-one percent of owners reported capital spending in the past six months, down five points from August. Of those spending, 35% reported spending on new equipment, 23% acquired a vehicle, and 15% improved or expanded their equipment. 10% spent money on new fixtures and furniture, and 4% acquired new buildings or land for expansion. The percentage of respondents planning capital investment in the next six months was 19% (seasonally adjusted), down 5 percentage points from August.
A net minus 17% (seasonally adjusted) of all owners reported an increase in nominal sales over the past three months, which was down 1 percentage point from August and the lowest reading this year. The net percentage of owners expecting real sales volume growth increased by 9 points to a net negative 9% (seasonally adjusted).
The net percentage of owners reporting inventory increases fell 4 percentage points to a seasonally adjusted net minus 13%, the lowest level since June 2020. Without seasonal adjustment, 10% reported an increase in inventory and 22% reported a decrease in inventory.
In September, a net negative 4% (seasonally adjusted) of owners believed current stock inventory was “too low,” an increase of 1 percentage point from August. Owners planning to invest in inventory in the coming months had a net negative 3% (seasonally adjusted), down 2 percentage points from August.
The net percentage of owners who increased their average sales price was a seasonally adjusted net of 22%, up 2 percentage points from August. 23% of owners reported that inflation was the single most important issue in running their business, down one point from August, but remained the top issue. Unadjusted, 13% reported a lower average selling price and 34% reported a higher average selling price.
The industries with the highest price increases were Financials (up 64%, down 4%), Retail (up 48%, down 9%), Transportation (up 41%, down 18%), and Construction (up 38%, down 12%). ) was. Bottom) Sector. After seasonal adjustment, a net 25% price increase is expected in September.
On a seasonally adjusted basis, a net 32% reported increasing compensation, down 1 percentage point from August and the lowest level since April 2021. The seasonally adjusted net 23% is up three points from August, with plans to increase compensation over the next three months. 9% of business owners cite labor costs as their business’ biggest problem, unchanged from August and just 4 points below the high of 13% set in December 2021. 17% said workforce quality was the biggest issue for their business, second only to inflation. One problem.
The frequency with which earnings trends were reported to be positive was a net negative 34% (seasonally adjusted), an increase of 3 percentage points from August. Among owners who reported a decrease in profits, 37% cited poor sales, 14% cited increased material costs, 13% cited labor costs, and 11% cited lower selling prices. Among owners who reported higher profits, 47% cited sales volume, 26% cited normal seasonal fluctuations, and 9% cited increased sales prices.
2% of owners said all of their borrowing needs were not met. 24% said all of their financing needs were met, and 62% said they were not interested in financing. A net 8% said it was more difficult to get a loan than their last loan.
Four percent of owners said financing was their biggest business challenge in September, unchanged from August.
The NFIB Research Center has collected small business economic trends data in quarterly surveys since the fourth quarter of 1973 and monthly surveys since 1986. Survey respondents were randomly selected from among NFIB members. This report is published on the second Tuesday of each month. This study was conducted in September 2024.
#NFIB #survey #Main #Street #uncertainty #reaches #record #high #NFIB