October 2017 NFIB

Small business confidence remained elevated during October 2017 according to data from the National Federation of Independent Businesses’ (NFIB) Optimism Index.  This indicator made back some of the 2.3 point decline in September, gaining 0.8 in the latest survey.  Of the ten components, four rose, five declined marginally, and one remained unchanged.

Labor-related components led the indicator higher.  The Job Openings category increased five points to 35 and is the highest rated element of the index.  Fifty-nine percent of business owners attempted to hire in the period, with 88 percent of them reporting no or few qualified applicants; of course, this is occurring in a fairly tight labor market as demonstrated by our nation’s 4.1 percent unemployment rate.  Construction firms in Florida and Georgia were particularly eager to hire as the two states repair damage caused by recent hurricanes.  Optimism about the near-term future is growing as well. Higher expectations for sales helped elevate this indicator, as did the outlook for expansions. 

Small firms seem happy with the current economic climate.  Optimism has remained elevated over the past year.  Firms are even coming around to making capital outlays; while this category was unchanged in the period, its reading of 27 demonstrates a relatively large proportion of independent businesses feel capital investments made today will have worthwhile benefits in the years ahead.  Data from the NFIB continue to support the narrative of a strengthening U.S. economy.