Small business owners are feeling much more optimistic.
The Small Business Optimism Index increased 6.2 points in June to 100.6, the National Federation of Independent Business said Tuesday. That beat expectations of 96.7 and was above even the high end of the range of economists surveyed by Ecododay.
The NFIB’s measure of sales expectations surged by a record 37 points to a positive 13, suggesting to businesses are seeing rising demand.
“Small businesses are navigating the various federal and state policies in order to reopen their business and they are doing their best to adjust their business decisions accordingly,” said NFIB Chief Economist Bill Dunkelberg. “We’re starting to see positive signs of increased consumer spending, but there is still much work to be done to get back to pre-crisis levels.”
In addition to sales expectations, seven other of the 10 components of the index rose. These include hiring plans, capital outlays, plans to grow inventories, overall economic expectations, current job openings, current inventories, and owners’ assessment of whether now is a good time to expand their businesses.
The reads of credit conditions and earnings were lower, which may reflect the margin squeeze that was on view in last week’s Producer Price Index.
The NFIB index, based on 670 companies polled across the country, is a monthly look at the conditions and expectations of small businesses in the U.S., which account for nearly half of private-sector jobs. It is considered a barometer of domestic demand and hiring conditions.
Despite the improvement, the index remains February’s pre-pandemic level of 104.5.