California Comment on NFIB’s Latest Small Business Survey

September 10, 2024

California Comment on NFIB’s Latest Small Business Survey

FOR IMMEDIATE RELEASE Contact: Tim Taylor, California Policy Director, timtaylor264@gmail.com or Tony Malandra, Senior Media Manager, anthony.malandra@nfib.org SACRAMENTO, Calif., Sept. 10, 2024—Today’s release of NFIB’s monthly Small Business Economic Trends report (aka the Optimism Index), the gold standard measurement of the nation’s Main Street economy, raises an important question for state and federal policymakers to consider deeply and fast: how many more consecutive months can small businesses endure being under the Index’s 50 year average? Last month was the 32nd. “Before allowing our small business economy to burrow any deeper into a permanent state of malaise, two things need to happen right now,” said Tim Taylor, policy director for NFIB in California. “One is Congress needs to pass the Main Street Tax Certainty Act to keep the 20% Small Business Deduction alive past its 2025 end date. A second thing that would be helpful is Governor Newsom should veto a dozen bills sent to him increasing regulations on small business, including one taking away the free speech rights of employers to talk to their employees. The First Amendment applies to small business owners just as it applies to everyone else.” From NFIB Chief Economist Bill Dunkelberg “The mood on Main Street worsened in August, despite last month’s gains. Historically high inflation remains the top issue for owners as sales expectations plummet and cost pressures increase. Uncertainty among small business owners continues to rise as expectations for future business conditions worsen.” Highlights from Today’s Report

The frequency of reports of positive profit trends was a net negative 37% (seasonally adjusted), seven points worse than in July and the lowest since March 2010.

Twenty-four percent of owners reported inflation as their single most important problem in operating their business, down one point from July.

The net percent of owners expecting higher real sales volumes fell nine points in August to a net negative 18% (seasonally adjusted).

A seasonally adjusted net 20% plan to raise compensation in the next three months, up two points from July.

Note to Reporters Last week (September 4), NFIB released an industry-specific Small Business Optimism report measuring the construction, manufacturing, retail, and services sectors. A noteworthy highlight (Page 12 of the full report): Seventy percent of all small business owners reported being impacted by supply chain disruptions (significant, moderate, or mild). NFIB’s monthly (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 (aka the Optimism Index) is a national snapshot of NFIB-member, small-business owners not broken down by state. More about the Uncertainty Index can be read here. The typical NFIB member employs between one and nine people and reports gross sales of about $500,000 a year. Keep up with the latest California small-business news at www.nfib.com/CA. Follow us on X @NFIB_CA and on Facebook, https://www.facebook.com/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 our 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