The NFIB Small Business Optimism Index fell 0.3 points in March to 92.6. Four of the 10 Index components posted a gain and six posted small declines. The biggest gain was in expected business conditions, a 4 point improvement to a still very negative number.
Owners remain very pessimistic about the economy. The political climate continued to be the second most frequently cited reason (after weak sales and a poor economy) for why the current period is a bad time to expand.
Reported job creation improved in March, with the average employment change per firm rising to an average gain in employment of 0.02 workers per firm. Thirteen percent (up 2 points) reported increasing employment an average of 2.2 workers per firm while 12 percent (down 1 point) reported reducing employment an average of 4.3 workers per firm. The gain is positive, but small, suggesting employment gains will continue to be modest but sufficient to keep the unemployment rate steady.
Forty-eight percent reported hiring or trying to hire (down 1 point), but 41 percent reported few or no qualified applicants for the positions they were trying to fill. A lack of social skills, appearance, and attitude are deficiencies that disqualify the applicant as often as a lack of specifically needed job skills or a poor work history.
Fifty-nine percent reported capital outlays, up 1 point. Overall, capital spending reports were more frequent but there was little new strength in spending.