NFIB News Release (07/08/14)
After a promising three-month run, the National Federation of Independent Business Optimism Index fell 1.6 points in June to 95.0. While job components improved, capital outlays and planned spending faded along with expectations for improving business conditions.
“The only two index components that increased in June were labor market indicators: the percentage of owners with job openings and the percentage planning to create new jobs in the coming months. While reports of actual net job creation per firm were positive, consumer and business owner optimism remain low, with both spending growth and sales expectations weak. This means there are more jobs but not much more output,” says Bill Dunkelberg, NFIB chief economist. “With election day months away and no sign of change in Washington, economic growth for the rest of the year will continue to be sub-par. The unemployment rate will fall more due to people leaving the labor force than to jobs being created and fewer hands making [gross domestic product].”
NFIB owners increased employment by a seasonally adjusted average of 0.05 workers per firm in June, the ninth positive month in a row and the best string of gains since 2006. Seasonally adjusted, 12% of owners reported adding workers, up one point. Fifty-three percent of the owners hired or tried to hire in the last three months; 81% of those reported few or no qualified applicants for open positions. More than a quarter of all business owners reported job openings they could not fill in the current period, suggesting further downward pressure on the unemployment rate.