The engine of the American economy is trying its best to start smoothly humming again, according to today’s release of the latest Small Business Economic Trends report (also called the Optimism Index) from NFIB, the nation’s leading small-business association. Now, can the surge in coronavirus cases abate long enough to take that engine for a test run on the road to recovery?
“I continue to be amazed by our small-business members,” said NFIB Oregon State Director Anthony Smith. “It’s remarkable that even with everything going on right now — a public health crisis, high unemployment and an election right around the corner — that small business optimism has exceeded the historical average of 98.0. That barely happened, just once or twice, in the years coming out of the Great Recession until the fall of 2016, when the Optimism Index shot up to record-high levels for 39 months.”
The Small Business Optimism Index increased 6.2 points in June to 100.6 with eight of the ten components improving, most sharply of all in the ‘real sales expectations’ component, followed distantly but solidly by ‘job openings,’ ‘good time to expand’ and ‘job creation plans.’ The net percent of owners expecting higher real sales volumes improved 37 points to a net 13 percent of owners. The historic 61-point drop over March and April has been followed by a 55-point increase over the past 2 months as owners are expecting higher sales with business re-openings.
The NFIB Research Center has collected Small Business Economic Trends data with quarterly surveys since the fourth quarter of 1973 and monthly surveys since 1986. Survey respondents are drawn from a random sample of NFIB’s membership. The report is released on the second Tuesday of each month. This survey was conducted in June 2020. For more information about NFIB, please visit nfib.com.
“Small businesses are navigating the various federal and state policies in order to reopen their business and they are doing their best to adjust their business decisions accordingly,” said NFIB Chief Economist Bill Dunkelberg. “We’re starting to see positive signs of increased consumer spending, but there is still much work to be done to get back to pre-crisis levels.”
Did you catch last Friday’s release of NFIB’s 22-question poll of its members? Here are six highlights:
Q4 Have you spent all of your [Paycheck Protection Program] loan funds yet?
56 percent 1. Yes
44 percent 2. No
Q17 Do you anticipate needing additional financial support over the next 12 months?
46 percent 1. Yes
55 percent 2. No
Q13 Is your business currently impacted by a postponement or reversal of state or local reopening actions?
47 percent 1. Yes
53 percent 2. No
Q15 Does your business require employees or customers to wear a face covering?
53 percent 1. Yes
47 percent 2. No
Q16 If so, do you find it difficult enforcing the face covering requirement?
46 percent 1. Yes
54 percent 2. No
Q20 How long will you be able operate your business under current economic conditions?
1 percent 1. Less than 1 month
3 percent 2. 1-2 months
19 percent 3. 3-6 months
21 percent 4. 7-12 months
57 percent 5. More than 12 months
Keep up with the latest Oregon small-business news at nfib.com/oregon and follow us on Twitter at @NFIB_OR.