While the current rebound in economic activity is the weakest recovery on record, small businesses across the country felt more optimistic last month. In fact, their optimism reached a new high as business conditions are expected to improve.
The National Federation of Independent Business, the leading nonprofit small business association representing small and independent businesses, reported that its Small Business Optimism Index increased 1.8 points from March to 95.2 in April, representing the highest reading for the index since 2007. At the beginning of 2013, the index posted a reading of only 88.9. The pre-recession average of the index is 100.
“April’s Index did pass the 95 mark that seemed to block any progress in optimism for the past five years. However, the Index is still 5 points below the average reading from 1973 to 2008, and far from what is considered expansion levels. This reading can only be characterized as a high end recession reading,” said NFIB chief economist Bill Dunkelberg. “Small business confidence rising is always a good thing, but it’s tough to be excited by meager growth in an otherwise tepid economy. Washington remains in a state of policy paralysis. From the small business perspective there continues to be no progress on their top problems.”