The NFIB Business Optimism Index came out this week showing continued optimism from small business owners:
The Index of Small Business Optimism gained 2 points to 94.5 in April, a nice gain on an absolute basis. This month’s Index is the highest reading since December 2007, the peak of the last expansion.
Reports of positive earnings trends improved a stunning 11 points to a negative 12 percent in April, the best reading since April 2007. The improvement was driven by the best sales trend reports since April 2007. Profits are the major source of capital for financing hiring and expansion for small firms, making this a very welcome development. Three percent reported reduced worker compensation and 18 percent reported raising compensation, yielding a seasonally adjusted net 14 percent reporting higher worker compensation, the highest reading in 39 months and unchanged from March.”
Personally I like the Business Optimism Index over the more publicized Conference Board Consumer Confidence Index as small business owners are more sensitive to the actions of consumers. While the Consumer Confidence Index is based more on consumer opinion – which can be heavily influenced by the media: