Small Business Optimism Rose to 105.0 in May
Washington, DC, June 11, 2019-Small business optimism eclipsed pre-shutdown levels, increasing 1.5 points to 105.0 in May.
Six components in the Small Business Optimism Index improved, three were unchanged, and one dipped. Capital spending plans increased along with actual outlays. Small business owners’ expectations for sales, business conditions, and expansion all rose, as the previously reported inventory imbalance was resolved. Earnings, job creation, and compensation remained very strong.
“Optimism among small business owners has surged back to historically high levels, thanks to strong hiring, investment, and sales,” said NFIB president and CEO Juanita D. Duggan. “The small business half of the economy is leading the way, taking advantage of lower taxes and fewer regulations, and reinvesting in their businesses, their employees, and the economy as a whole.”
Business owners reporting capital outlays increased six points to 64%, the highest reading since February 2018. Thirty percent plan capital outlays in the next few months, up three points and historically high. Plans to invest were most frequent in transportation (45%), manufacturing (39%), professional services (39%), and construction (31%).
“Small business owners are demonstrating a continued confidence in the strength of the economy and are betting capital spending dollars on it,” said NFIB chief economist William Dunkelberg. “This solid investment performance is supporting ongoing improvements in productivity and real wages.”