The National Federation of Independent Business’ Small Business Optimism Index set a new record high in the month of August, shattering the previous record set in 1983 and confirming what most Americans already know — the economy is firing on all cylinders under President Donald Trump.
The NFIB Research Center has been collecting small business economic trends data and publishing quarterly surveys since 1973, and monthly surveys since 1986. The sample was drawn from NFIB members who are sent the surveys to complete to come up with the final score. August’s score hit 108.8, topping the previous high of 108 set under Ronald Reagan’s leadership 35 years ago.
The report goes on to note the “small business engine continues to roar with the dramatic change in economic policies since November of 2016.” Companies planned the most capital spending since 2007 and hiring intentions also hit an all-time high in August.
Small businesses are increasingly optimistic as the economic expansion enters its 10th year, and the Trump administration prioritizes industry deregulation and tax cuts. Companies have been boosting inventories to match robust consumer demand for goods and services.
Here are some other details from the report:
- 34% said now is a good time to expand business, up two points from
the prior month.
- A record 25% of owners cited “quality of labor” (hiring problems) as
the single most important problem facing their company.
- Six of 10 Optimism Index components increased from the prior month.
While the gauge of intent to hire reached a record high, finding qualified workers remains a problem. Of companies trying to fill a position in the month, 89% reported finding few or no qualified applicants.
The number of available jobs in the US exceeded the number of job seekers by more than 650,000 in July — a gap that has been growing — in a sign of an increasingly tight labor market that is altering how employers find workers.
The number of available jobs in the US rose by about 117,000 to a seasonally adjusted 6.94 million in August versus only 6.28 million Americans who were unemployed, the Labor Department said – and not all of those people want to go back to work. No wonder employers are having difficulty finding qualified applicants.
Household Income Rises to New Record High
Median US household income rose to a record high of almost $61,400 in 2017 according to a new report from the Census Bureau yesterday. That was a gain of 1.8% last year following a gain of 3.2% in 2016 and 5.2% in 2015.
Household income, by the Census Bureau’s measure, includes bonuses, Social Security, public assistance payments and interest and dividends from investments, among other sources.
The number of Americans living in poverty was roughly unchanged at 39.7 million last year but the poverty rate dipped to 12.3% from 12.7% in 2016, the third straight annual decline. Since 2014, the rate has fallen from 14.8%, the Census report said.
Lower-income Americans are benefiting from the tight job market since employers are now willing to hire those who had been marginalized in the past. Also, 21 states plus the District of Columbia raised their minimum wages last year, giving some workers an income boost that may have pushed them over the poverty line.
Across racial groups, inflation-adjusted income increased 2.6% for white households to $68,145 and 3.7% for Hispanics to $50,486. Income was unchanged for Asians at $81,331 and for blacks at $40,258.
While overall income grew last year, the snapshot of wages was mixed. Median inflation-adjusted earnings for men increased 3% to $44,408 while women’s median earnings held steady at $31,600.
Meanwhile, the uninsured rate held steady at 8.8%, with 28.5 million people lacking health coverage last year. These figures were not statistically different than 2016. The rate in the 19 states that did not expand Medicaid grew by 0.7 percentage points, however.
Stephen Moore: Trump Deserves Nobel Prize for Economics
I’ve mentioned before that Stephen Moore of the Heritage Foundation has become one of my favorite writers. He wrote an interesting column this week in which he suggested that President Trump deserves the Nobel Prize for economics.
While I agree that Trump should get much of the credit for the economic surge due to his bold, pro-growth policies. Yet I don’t believe there’s any way he will get a Nobel Prize since most in the mainstream media despise him! Here’s a link to the Stephen Moore article.
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