November 30, 2020
Main Street Monday — 27% of Small Business Owners Expect Better Business Conditions in the Next Six Months
According to NFIB’s Small Business Economic Trends quarterly report, small business optimism in October remained unchanged from September, a historically high reading. Small businesses also indicated a historically high level of job openings in October with 55% of owners reporting that they were hiring or trying to hire. Although these trends are positive, significant concerns remain for Main Street businesses.
Here are the major findings from NFIB’s most recent report:
- NFIB’s small business owner uncertainty Index rose to a near-record high of 98, reflecting worries about the pandemic and government-mandated restrictions.
- Owners expecting better business conditions over the next six months declined 5 points in October to a net 27%.
- 22% of those surveyed said that labor quality was their top business problem, exceeding taxes, regulations, and weak sales.
- 53% of owners reported capital outlays in the last six months. Historically, this is poor performance because it impairs future growth in worker productivity and pay.
- Small businesses continue to see improvements in foot traffic and sales. A net 6% of all owners (seasonally adjusted) reported higher nominal sales in the past three months, an improvement of 12 points from September.
- 23% of small business owners reported raising compensation last month and a net 18% plan to do so in the coming months.
- 97% of small business owners reported that all their borrowing needs were satisfied and that their last loan was easier to get than previous loans.
“Small businesses [owners] continue to focus on stabilizing their businesses but were uncertain about future economic conditions due to COVID-19 government regulations on all levels,” says NFIB’s Chief Economist. “We see solid momentum going into the 4th quarter, and another good quarter could get the GDP back to its 2019 closing levels.”