Investigating the confidence of growing entrepreneurs is one way to gauge the overall state of the economy. The latest assessment on the level of optimism among American micro-business owners was released on Sept 11 by the National Federation of Independent Businesses— and the figures show that confidence has gone up to a record high, even surpassing industry projections. The federation reported that hiring as well capital spending hit an unprecedented high as of 2007.
Small companies are getting more and more optimistic as economic growth hits a decade and President Trump’s administration lay emphasis on deregulating the industry and cutting taxes. In the meantime, businesses have also been incorporating more inventories to match increasing shopper needs for goods and services.
“The micro-business engine keeps roaring with the remarkable change in most economic policies as of November 2016,” Reads the National Federation of Independent Businesses’ report.
Employment rates or just the intent to hire is also another way to check the overall temperature of the economy. According to the Federation, the intent to hire hit an all-time high, but merchants still admit to finding difficulties getting qualified personnel. Of the businesses attempting to fill in a vacancy in the month, a whole 89 percent said they met a few or no competent candidates.
Checking salaries and the intent to increase them is another feature the research group looked at. The federation said plans to make higher compensation remained the same at 32 percent of businesses and intentions to boost pay went down 1 point to 21 percent.
A whole 25 percent of company owners mentioned “quality of labor” as the number one problem facing their business.
Here’s a sneak peek into other findings according to the National Federation of Independent Businesses’ Findings:
- 34 percent of merchants said it is a good time to grow their businesses; this figure is up 2 points from the previous month’s record.
- Expectations of higher sales have gone down 3 points to settle at 26 percent from the previous month.
- Of the ten index components studied by the Federation, up to six increased in comparison to the previous month’s figures.
An optimistic retail industry points to a steady and growing economy. U.S policymakers and financial institutions must now work together to improve conditions for merchants. For instance, they should increase acceptance rates of high risk business loans to support this often ignored group of retailers.
Author bio:As the FAM account executive, Michael Hollis has funded millions by using high risk business loans. His experience and extensive knowledge of the industry has made him a finance expert at First American Merchant.