SURVEY: Post-election small business optimism sustained in January
February 15, 2017
Small business optimism rose again in January to its highest level since December 2004, suggesting that the post-election surge has staying power, according to the monthly National Federation of Independent Business (NFIB) Index of Small Business Optimism.
“The stunning climb in optimism after the election was significantly improved in December and confirmed in January,” said NFIB President and CEO Juanita Duggan. “Small business owners like what they see so far from Washington.”
State-specific data isn’t available, but NFIB State Director Ben Homeyer said the national trends are reflected here. “There’s no doubt that small-business owners are encouraged by what they’re hearing.”
The Index reached 105.9 in January, an increase of 0.1 points. The uptick follows the largest month-over-month increase in the survey’s history. Five of the Index components increased and five decreased, but many held near their record high.
“The continued surge in optimism is a welcome sign that economic growth is coming,” said NFIB Chief Economist Bill Dunkelberg. “The very positive expectations that we see in our data have already begun translating into hiring and spending in the small business sector.”
Job openings and job creation plans both posted small gains, pushing the NFIB Jobs Report into a strong, positive direction. Dunkelberg said the data could signal higher GDP growth in 2017.
The recent growth in optimism looks similar to the surge in the Index in 1983, which was followed by years of economic prosperity. Duggan said after eight years of struggling with government barriers, small business owners are hopeful that policy proposals from the new administration and Congress will spur economic growth in a similar manner.
“We’ve had very low growth for years, mainly because small businesses have been tied down by regulations, taxes, and spiraling health insurance costs,” she said. “Now they can see relief on the horizon, and they are much more optimistic about the future.”
The percent of owners planning capital outlays fell two points to 27 percent, but it is still close to the highest reading of the recovery. Owners expecting better business conditions and better sales also dipped slightly, but, according to Dunkelberg, the high readings support expectations of actual spending.
“The data reflects the expectation among small business owners that things are about to change for the better,” he said. “Now it’s up to the President and Congress to follow through—our data will quickly reveal whether small business loses faith.” Click here to view the entire NFIB Index of Small Business Optimism. For more information about NFIB, please visit www.NFIB.com.
NFIB
NFIB is the nation’s leading small business association, with offices in Washington, D.C. and all 50 state capitals. Founded in 1943 as a nonprofit, nonpartisan organization, NFIB gives small and independent business owners a voice in shaping the public policy issues that affect their business. NFIB’s powerful network of grassroots activists sends their views directly to state and federal lawmakers through our unique member-only ballot, thus playing a critical role in supporting America’s free enterprise system. NFIB’s mission is to promote and protect the right of our members to own, operate and grow their businesses. More information is available online at www.NFIB.com/newsroom.
