Comment on Latest Small Business Optimism Report

May 14, 2024 Last Edit: July 30, 2024

Comment on Latest Small Business Optimism Report

FOR IMMEDIATE RELEASE Contact: John Kabateck, California State Director, john@kabstrat.com or Tony Malandra, Senior Media Manager, anthony.malandra@nfib.org SACRAMENTO, Calif., May 14, 2024—Release today of the latest Small Business Economic Trends report, also known as the Optimism Index, shows little has changed in this new era of unspectacular readings of the Main Street economy. “Small business optimism improved slightly from March to April, but a blip is no sign of a healthy economic pulse rate,” said John Kabateck, California state director for the National Federation of Independent Business (NFIB), which conducts the monthly poll of its members. “I believe the biggest culprit is Congress dragging its feet on passing the Main Street Tax Certainty Act, which will prevent small businesses from being whacked with a mammoth tax increase when the Small Business Deduction expires in 2025.” In California, Kabateck offered qualified praise for a recent act by the Legislature to not sock businesses with higher costs. “I think placing Senate Bill 1116, which would extend unemployment benefits to those who go out on strike and to undocumented workers, on the suspense file was a smart move by lawmakers and sent a strong message to employers that further increases in their UI taxes would be curtailed. However, a similar measure last session was also thought dead until it sprang from its coffin to live again under the Legislature’s insidious gut-and-replace tactic, so we’ll not celebrate the demise of SB 1116 until the session ends.” From NFIB Chief Economist Bill Dunkelberg “Cost pressures remain the top issue for small business owners, including historically high levels of owners raising compensation to keep and attract employees. Overall, small business owners remain historically very pessimistic as they continue to navigate these challenges. Owners are dealing with a rising level of uncertainty but will continue to do what they do best – serve their customers.” NFIB’s monthly Small Business Economic Trends (SBET) report is the gold standard measurement of America’s small business economy. Used by the Federal Reserve, Congressional leaders, administration officials, and state legislatures across the nation, it’s regarded as the bellwether on the health and welfare of the Main Street enterprises that employ half of all workers, generate more net new jobs than large corporations, and gave most of us the first start in our working life. The SBET (Optimism Index) is a national snapshot of NFIB-member, small-business owners not broken down by state. The typical NFIB member employs 10 people and reports gross sales of about $500,000 a year. Highlights from Today’s Report

Twenty-two percent of owners reported that inflation was their single most important problem in their business, down three points from March but still the number one problem for small business owners.
A net 26% (seasonally adjusted) of owners plan price hikes in April, down seven points and the lowest reading since April of last year.
Forty percent (seasonally adjusted) of all owners reported job openings they could not fill in the current period, up three points from March, which was the lowest reading since January 2021.
The net percent of owners raising average selling prices fell three points from March to a net 25% seasonally adjusted.

Keep up with the latest on California small-business news at www.nfib.com/california or by following NFIB on Twitter @NFIB_CA or on Facebook @NFIB.CA.? ### For 80 years, NFIB has been advocating on behalf of America’s small and independent business owners, both in Washington, D.C., and in all 50 state capitals. NFIB is a nonprofit, nonpartisan, and member-driven association. Since its founding in 1943, NFIB has been exclusively dedicated to small and independent businesses and remains so today. For more information, please visit nfib.com.? NFIB California 915 L St. Ste C-411 Sacramento, CA 95814 916-448-9904 NFIB.com/CA Twitter: @NFIB_CA