Job openings at small businesses fire on all cylinders—despite Federal interest rate increases
(up) 50 percent more job openings in April were by small/midsized employers compared to 2019
(down) 14 percent fewer job openings by larger employers compared to 2019
500 or fewer employees with revenue between $1 and $40 million is how the SBA defines a small business
55 percent of all job openings in any given month are created by small businesses
80 percent of all job openings in any given month are created by small and midsize businesses
33 million small businesses fuel the American economy
99.9 percent of the nation’s businesses fall into the category of small/midsized
Small business—sensitive to rising interest rates—rely on lending to launch and operate their businesses
Against the wind
Small business confidence has reached a 12 year low, lower than during lockdowns. Those who run 99.9 percent of U.S. businesses and hire over half of all American workers—are showing signs of stress from pervasive taxes, rising regulation and prices, and an unfavorable business environment.
Small business optimism index
Small company CEOs are even more fearful of the future today than during the COVID-19 pandemic, when most businesses were shuttered. The confidence numbers have decreased every year for the last four years.
2020 – 102.0
2021 – 98.2
2022 – 93.2
2023 – 90.1
2024 – 88.5
Small business optimism outlook
current job openings 42 percent
plans to make capital outlays 23 percent
plans to increase employment 15 percent
now’s a good time to expand 4 percent
plans to increase inventory -6 percent
expected credit conditions -7 percent
current inventory status (too low) -8 percent
expect higher real sales -13 percent
earning trends -30 percent
expect economy to improve -30 percent
Federal funds rate 5.5 percent
11 number of Fed increases (2022-23) to its benchmark interest rate in an attempt to subdue the worst inflation in 4 decades
Source: U.S. employers added a solid 206,000 jobs in June in a sign of continued economic strength, Paul Wiseman, AP; Chart 1—small business optimism index from the national federation of independent business; Chart 2—Statista, in May 2024, a net 15 percent of surveyed small business owners in the United States had plans to increase employment in the coming three months. Additionally, around 42 percent of said that they had current job openings. Chart 3—AP reports; Federal Reserve Bank of St Louis; Data—values represent the upper limit of the target range for overnight loans between banks; Chamber of Commerce—small business statistics; 2024 small business optimism index from the National Federation of Independent Business
