As Donald J. Trump is sworn in today as the 45th President of the United States, there is one group of small business owners who have already registered their optimism for a Trump presidency: the members of NFIB participating in the small business organization’s long-running optimism index. Since election day, the organization’s monthly tracking survey of small business optimism has risen to 105.8, its highest reading since December 2004.
In the December NFIB Index of Small Business Optimism (released this week)—the oldest continuous survey of small business (quarterly since 1973 and monthly since 1986)—expectations for real sales gains and the outlook for business conditions accounted for 73 percent of the gain.
Signs of optimism in the survey:
- Capital spending posted a strong advance in December
- Job creation plans remained at the highest levels seen since 2007
- Reports of compensation gains were robust
- Reports of higher prices, though the highest all year, were infrequent.
NFIB survey results are similar to consumer sentiment research
During the same period, the University of Michigan’s Consumer Sentiment Index showed a similar response. Averaging a reading of 91 for the first 10 months of 2016, it jumped to 93.7 in November and 98.2 in December, the highest reading since January 2004.