The National Federation of Independent Business (NFIB) released its June Optimism Index and there was a slip from May figures. Small businesses showed that 6 of 10 categories in the survey fell month-over-month. Only labor hiring sentiment and current job openings indexes were higher in the month.
On that point, there is some evidence that many employees have become free agents and are job jumping now. That has increased the rate of hiring – even though a lot of the activity is just that – job jumping. People working part time are jumping at the opportunity to capture full time work with benefits. Hiring someone currently working still seems to be more popular than hiring a worker that has been out of work for a long period of time. Still, somewhere, someone is getting a new job – it just might be part time (as workers jump from part time to full time – part time jobs experience vacancies).
To summarize what small businesses in America are saying, they plan to invest a little less, reduce inventories more (carry less on hand), won’t expand, and largely because they believe that sales are weakening, the economy is starting to slow, and earnings will be pressured.
Armada Corporate Intelligence provided the following footnote and warning: this is one month. The NFIB pointed out that this is just a point in time and we need to see some consecutive months in order to consider this a trend worth placing stock in. This is a bit of an unexpected turn-around from a strong 3 month run of positive improvements in sentiment. But, something has turned small businesses sour in June.
Courtesy: Armada Corporate Intelligence