del.icio.us
Digg
Sphere
Stumble
Technorati
Twitter
Bear Market in Optimism
By Bizbox
The National Federation of Independent Business has released the results of its monthly Small Business Optimism survey for September and--surprise!--the group's confidence index remains "recession level". More dishearteningly, fully half of the survey data was taken before Lehman Brothers's collapse in the middle of last month kicked off the present troubles; when you divide the month into the before and after, it becomes clear that these events have eroded small business owners' confidence only further.
The good news? Believe it or not, September's confidence index was higher than August's, which itself was higher than July's. (The index is seasonally adjusted.) "Dramatic improvements in the percent of owners expecting the economy to improve over the next six months and solid plans to invest in new inventories accounted for the early surge, but the bulk of the gains were erased by events from mid-month on," the group's chief economist explained. Slightly more, if slightly under half, of small business owners are hiring. Almost double the percentage of respondents said that the next three months were a good time to expand as compared to August; unfortunately, September's percentage was still an abysmal 11%.
More stats:
49% of small business owners tried to hire; 78% of these found minimal qualified applicants. 12% hope to add employees over the next three months; 10% plan to decrease their workforce.
21% are planning capital expenditures, a figure the report calls "historically weak," and which represents a slight decrease from August.
Net -12% reported inventory gains, indicating a trend towards liquidation.
Net 20% reported increasing their prices--not a good sign as we enter a period where consumers are going to have much less spending power.
Net -5% reported earnings gains. Uh-oh.
Net -11% said borrowing was easier than it was. No surprise here: the lifeless credit markets are the big story of our current macroeconomic circumstance.
Well, in fairness, while the Lehman/Merrill/AIG/everything else debacle did clearly decrease confidence in the September survey, who knows--maybe the federal government's decision to inject $250 billion directly into banks, which had such a salutary effect on the Dow, will do wonders for the survey the NFIB gives us in November. Stay tuned.
Comments (0)October 15, 2008 9:18 AM
