A survey released this week revealed that small company proprietors in the United States are feeling their worst in almost five decades.
The Ntnl Federation of Independent Business announced that its indicator of firms anticipating greater business prospects in the next six months has hit a record low in the 48-year history of the survey. The previous all-time high was recorded in April.
Inflation continues to be a significant issue for small companies, with 28 percent of small business owners reporting it as their main concern in running their business. That is lower than the 32% recorded in April, which was the highest recorded since Q4 of 1980.
“Inflation is continuing to outpace wage growth, which has reduced people’s real incomes across the nation,” said Bill Dunkelberg, NFIB’s chief economist. “Small company owners are still rather gloomy about the second part of the year due to supply chain issues, inflation, and a labor shortage that isn’t going away.”
The net percent of owners who increased their selling prices went up two points to a net 72%, reaching the highest reading seen in 48 years. This number has risen 40 points since May of last year.
In May, consumer prices increased 8.6 percent, according to the BLS’s Consumer Price Index, which was released last week. That is the highest rate of inflation since 1981.
The NFIB’s Small Business Optimism Numbers fell around one basis point in May down to 93.1, the 4th consecutive month of negative scores.
Job openings which could not be filled rose to 51% among business owners, up four points from the previous readings of April and March.
Instead of getting better, supply chain issues appear to be worsening. 39% of business owners report that global supply chain problems have had a big impact on their company, up three points from the month of April. Another 31% indicate a moderate effect, and 22% indicate a minor impact has been caused by the current supply chain problems. Only 8% of respondents claim there has been no influence owing to the most recent supply chain difficulties.
Since the fourth quarter of 1973, the NFIB Research Center has researched Small Business Economic Trends numbers with quarterly surveys and monthly polls since 1986. NFIB members are chosen at random in each survey. This poll was taken in May 2022.