Last month the NFIB Small Business Optimism index took a rather disturbing turn downward. However, the April index (released today) bounced right back on reports of strong profits, sales, capital spending and job creations plans.
More than one-fourth of those surveyed (28 percent) plan to create new jobs over the next three to six months, while just 4 percent plan reductions, a seasonally adjusted seven point rise over March. Overall, job creation plans in all industry groups were strong, especially in manufacturing and construction. The strongest regions were Mountain, Mid-Atlantic and South Atlantic states.
Seasonally adjusted, 11 percent reported employment increases in April, but 14 percent had reductions. Those expanding employment more than offset the impact of reductions, producing a net gain of 0.2 employees per firm. Nearly half (49 percent) hired or tried to hire one or more workers; 84 percent of those could find few or no qualified applicants for unfilled positions; 31 percent reported unfilled openings, an eight point surge from March.
This is good news for our economy, since small business has created 77% of all new jobs over the past two decades in the US.
The NFIB calls the dip in optimism in March a “fluke.” However, they do caution that there are some signs of inflation, which could throw a monkey-wrench into current economic expansion.