Survey: Small business optimism strong
CHARLESTON — The NFIB Small Business Optimism Index remained basically unchanged in December, drifting down 0.4 points to 104.4, according to a report released this week.
Unfilled jobs and the lack of qualified applicants continue to be a primary driver, with job openings setting a record high and job creation plans strengthening, the report said.
State-specific data was unavailable, but NFIB State Director Gil White said West Virginia employers are having trouble finding applicants.
Reports of higher worker compensation remained near record levels and inventory investment plans surged. Expected real sales growth and expected business conditions in the next six months, however, accounted for the modest decline in the index.
“Optimism among small business owners continues to push record highs, but they need workers to generate more sales, provide services, and complete projects,” NFIB President and CEO Juanita Duggan said in the release. “Two of every three of these new jobs are historically created by the small business half of the economy, so it will be Main Street that will continue to drive economic growth.”
The report also said that actual hiring strengthened to the highest reading in six months, job openings are at a record high levels, and plans to create new jobs are down only three points from August’s record high.
The report also showed a net percent of owners expecting better business conditions in six months and the percent viewing the current period as a good time to expand have both tapered off since the record high index reading in August, but still remain well above their historical averages.
The report said actual capital outlays are 5 percentage points higher than in August, although plans for outlays are 8 points below the high for this expansion. Also, plans to invest in inventories are only 2 points below August, the record high. Satisfaction with inventories is 2 points better.
Last week’s NFIB Jobs Report noted that job creation remained solid with a net addition of 0.25 workers per firm, up from 0.19 in November and the best reading since July.
A record 39 percent of small business owners reported job openings they could not fill in the current period. Sixty percent of owners reported hiring or trying to hire, but 90 percent of those reported few or no qualified applicants for the position. Twenty-three percent of owners cited the difficulty in finding qualified workers as their single most important business problem.