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Report: Small business optimism up among all sectors except retail

In Business Madison
By In Business Madison
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The National Federation of Independent Business (NFIB) announced the release of its NFIB Research Center’s quarterly Small Business Economic Trends industry report showing a growing optimism index in the construction, manufacturing, and services industries but a slight decrease for retailers. NFIB’s July Small Business Economic Trends report reported the overall Optimism Index at 99.7. Key findings include:   

Construction  

  • The Optimism Index for July was 98.8, up 1.4 points from April’s quarterly report; 
  • Small business owners in the construction industry had the highest percentage of unfilled job openings among all industries at 61%; 
  • The demand for new construction remains high but companies struggle to hire qualified workers; 
  • Fifty-nine percent of the job openings in the industry are for skilled workers and 66% of construction firms reported few or no qualified applicants; and
  • Sixty-five percent of construction firms reported raising prices in July.  

Manufacturing  

  • The July Optimism Index for manufacturing was 105.2, up from 104.8 in April;  
  • Sixty percent of manufacturing firms reported unfilled job openings, second only to the construction industry ;  
  • A net 41% of firms plan to create new jobs in the next three months; and   
  • A net 9% of manufacturing owners expect higher sales in the next three months.  

Retail  

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  • The retail industry’s July Optimism Index was 100.4, two points down from April;   
  • Earnings trends in retail fell 11% from the previous quarter to a net -9%; 
  • Retail owners’ expectations about economic conditions over the next six months declined nine points to a net -22%;  
  • A net 20% of retailers report current inventory levels “too low,” compared to a net 12% of all small businesses; and   
  • The retail industry is increasing inventory levels as part of a net 13% plan to increase inventories over the next three to six months.  

Services  

  • The service sector Optimism Index increased in July to 100.2; and  
  • A net -19% expect better business conditions six months from now, a decline of 11 points from April. 

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