Small Business Optimism Inched Upward in May, Remains Below Average

Nashville, TN, June 14, 2016—The Index of Small Business Optimism rose two tenths of a point in May to 93.8, a negligible increase showing no real enthusiasm for making capital outlays, increasing inventories, or expanding, according to the National Federation of Independent Business (NFIB).

At 93.8, the Index remains well below the 42-year average of 98. Four of the ten index components posted a gain, four declined, and two were unchanged. The biggest increase was Expected Business Conditions, which rose five points, a good sign but still nine percentage points below last year’s reading.

Owners are still reporting that they cannot find qualified workers and cite it as their fourth “Single Most Important Business Problem.”  Earning trends among small businesses fell another point and sits at a dismal reading of negative 20. The political climate continues to be the second most frequently cited reason for why owners think the current period is a bad time to expand.