Small Business Optimism Rebounds to Beat Expectations in July

Uncertainty Index for Small Business Fell 10 Points, Reversing Damage

The NFIB Small Business Optimism Index rose 1.4 points to beat expectations at 104.7, as rising uncertainly has been reversed and replaced with resilience. Expectations for business conditions, real sales, and expansion all made solid gains.

The Uncertainty Index fell 10 points, reversing a surge in June that reached the highest level since March 2017.

“While many are talking about a slowing economy and possible signs of a recession, the 3rd largest economy in the world continues to defy expectations, generating output, creating value, and expanding the economy,” said NFIB President and CEO Juanita D. Duggan.

“Small business owners want to grow their operations, and the only thing stopping them is finding qualified workers.”

In July, 57% of owners reported capital outlays. Of those cap-ex expenditures, 41% reported spending on new equipment (+1), 25% acquired vehicles (+3), and 16% improved or expanded facilities (+4).

Six percent (6%) purchased new buildings or land for expansion, and 12% kicked out for new fixtures and furniture.

However, the skills gap continues to persist as a major problem.

The NFIB Jobs Report found job creation slowed in July, falling to an average addition of 0.12 workers per firm. A record 26% of small business owners surveyed cited the skills gap — or, difficulty finding qualified workers — as their single most important business problem.