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William Dunkelberg, NFIB chief economist, with the results of the NFIB’s August optimism index.
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All right US small business sentiment rising in August for the first time in four months that's encouraging this according to the NF five b.'s latest optimism index so the question is what is giving business owners hope and does this mean they will begin to -- The NFIB's chief economist -- -- joining us now also I guess to begin this.
Bill thank you for joining us firstly and also what does this optimism based on.
Thanks actually well it's based on ten questions that we ask a random sample of -- 350000.
Member firms every month -- now.
So we asked about the hiring plans.
Job openings and -- hard to fill inventory investment plans capital spending plans.
And their expectations about business conditions out six months and whether they think their sales are gonna go up or down and of course how our profits so we asked them ten questions.
But -- mall into this index.
It's average value going into through 2007.
Was a hundred.
New -- and -- it will -- 93 right now so we're kind of off the average and certainly not typical of an expansion reading.
Yes small businesses usually the first to see an improvement in the economy what are they telling you.
Yeah that's that's true you know if you know GM doesn't get the message Intel GM dealers says hey you know we're sell more cars so make a few more for and so you know usually the small businesses -- -- first and we look that.
Their reports of quarter on quarter sales trends and we have far more firms telling us -- quarter -- quarter sales are headed down rather than up so they're confirming what.
The government kind of it's been telling us and that is that consumer spending is really pretty weak him.
That means of course if you're not having more customers you have no need to hire and hope we've no surprise were not hiring this -- are concerned about have -- businesses have gotten used to operating with.
Fewer employees and that's kind of a -- -- to get out of well no I don't think that's the case.
We know we have to take care customers who want to come back so as soon as more customers appear.
We're gonna hire people to take care of them.
But you know when you hire somebody you have to kind of make a bet that they'll be able to bring enough value to at least pay for what -- -- -- -- can break even on them.
And right now those prospects aren't so good very.
Very few owners relative relatively expect their real sales to go up over the next 36 months -- -- -- no need to hire right now.
-- bottom line is a lot of uncertainty it's that a presidential election coming -- Big Brother.
Questions about where's the tax policy gonna go health care costs cut the fiscal cliff so on and so once it clearly.
That's got to create a lot of concern for the small business owner.
So what are they more optimistic about unabomber administration or Romney administration.
We know that I can't really tell because we don't have really any data on.
That we don't know -- how many hours -- how many of these there are in the membership and -- we don't know exactly what.
What their view is below we do know is that they're choices are not really good though the election odds right now as you see all the polls is 5050.
So -- have a flip of the -- chance of having two very very different outcomes.
Whether the president is reelected or whether.
Mister Romney is elected and when you when you have those very disparate outcomes.
You don't put your money on the table on the right -- points -- you you you keep your powder dry which seems to be what business is doing.
Wait to see what it is and then you can decide what to do right and hopefully the picture will be that much clearer soon all right build uncle -- thank you so much for joining us we really appreciate it thanks.
