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Small Business Confidence Highest Since Recession Began, Report Finds
Published on Dec 16, 2010
Read our article, 'Small Business Confidence Highest Since Recession Began, Report Finds' at 'Time to Start Up,' the small business blog by BizFilings.
Confidence among U.S. small businesses has reached its highest level since the recession began, providing one of the most significant indications of substantial economic recovery in months.
The National Federation of Independent Business' monthly optimism index rose to 93.2 in November - up from 91.7 in October - the highest since December 2007. However, the index has a ways to go before reaching the expansion-era average of 100.7.
"It was encouraging to see substantial improvement in expectations for economic performance, critical if spending and hiring are to elevate beyond survival and replacement levels," NFIB chief economist William Dunkelberg said in a statement. "Plans to hire, make capital outlays and invest in inventories all rose, albeit from historically low levels."
Many analysts remain optimistic that the boom in small business confidence will encourage owners to begin hiring in larger numbers, as unemployment remains the primary obstacle to economic recovery. As more small businesses seek to incorporate or form an LLC, the nation's seven-month-high unemployment rate of 9.8 percent remains a challenging figure to dismiss.
However, the expectation of higher sales among the country's businesses also indicates a gain in consumer spending, which has been spurred by the ongoing holiday shopping season. This year's Cyber Monday already smashed the previous record for highest online spending in a single day, reaching more than $1 billion in online transactions.