Over the last several months, it seems that many entrepreneurs across the country have grown just a little more hopeful about their companies’ futures. In many cases, their views have been brightened by the continued economic recovery, which has slowly but surely trickled down to the point that these companies are boosting plans to spend and hire in the near future.
The overall amount of small business optimism seen across the country in March rose to a reading of 96.9, up somewhat from the 95.2 level seen a month earlier, but still below the level seen at the start of the year, according to the latest Small Business Optimism Index from the National Federation of Independent Business. That number is a little below the historical average – benchmarked at 100 – seen since the start of 1975, but has typically been hovering at this middling level for some time now.
“Optimism may have seen a slight jump from last month’s weak numbers, but there was not an especially large gain in any area except for an improvement in profit trends,” said NFIB chief economist Bill Dunkelberg. “Small business owners are still wary of the future, and that’s most evident when we asked them about future sales. Overall, the Index remains steady, but it is still a few points below the average and is showing no tendency to break out into a stronger pattern of economic growth. The little economic growth we do see is coming mostly from small businesses. Solid economic growth would require good performance from both big and small firms and that will likely be elusive this year.”
A closer look at the data
The good news is that companies are generally seeing a lot more reason to be hopeful about the near future, as 8 of the 10 aspects of the index took at least some step forward in March, while another held steady, the report said. The most notable of these were that 27 percent of companies currently had more job openings – up from 24 percent a month earlier – and 26 percent planned to increase their capital outlays over the next several months – up from 24 percent.
In addition, though, another 11 percent planned to increase employment during that same future period, an increase from February’s 10 percent, the report said. But at the same time, the expectations for sales to improve actually slid 3 points, to just 10 percent of all owners. And while the outlook on future economic improvement is on the rise, it still hovers in negative territory overall.
What can owners do?
Entrepreneurs who want to ensure their companies are in the best possible position be able to hire, buy equipment, and so on might want to consider the benefits of finding lower-priced small business insurance. For instance, if they can cut their commercial insurance spending by finding more affordable coverage, that might translate into savings of as much as a few thousand dollars annually.