President Obama has proclaimed this week as National Small Business Week , but the nation’s entrepreneurs are finding little to celebrate.
“The ‘get up and go’ usually present in the small business sector after a recession ‘got up and went’ somewhere. For the small business sector, this is the worst recovery on record,” said the National Federation of Independent Businesses in a prepared statement.
Small business owners are growing more pessimistic about the future with April marking the second consecutive decline in the NFIB’s confidence index, which dropped to 91.2 last month. Uncertainty about the federal deficit, inflation, energy and health care costs worry most small business owners who are seeing continued weak demand for their products and services.
“While it’s too early to say that a trend has emerged, a second consecutive month of decline in small-business optimism does very little to encourage further confidence in a strong economic recovery,” said Bill Dunkelberg, chief economist at the NFIB. “Owners simply find no reason to be optimistic about the future and therefore find no reason to pick up the pace of spending and hiring.”
The nation’s 27.2 million small businesses employ more than half the nation’s workers and create 60 percent to 80 percent of the new jobs in the nation, reports the U.S. Small Business Administration. In his proclamation Obama said, “From the family businesses that anchor Main Street to the high-tech startups that keep America on the cutting edge, small businesses are the backbone of our economy and the cornerstone’s of America’s promise.”
But according to the NFIB, small business owners have yet to participate in the economic recovery. They report few plans to expand their businesses or add workers. Dunkelberg said, “Owners simply find no reason to be optimistic about the future and therefore they find no reason to pick up the pace of spending and hiring.”
The latest federal employment figures show that the economy added 244,000 new jobs in April, though the unemployment rate edged back up to 9 percent. Small business owners do not appear to be big players in this trend.
“While reports of net jobs created by small firms stayed positive, the numbers posted did not match the surprising gains cited in last week’s Labor Department report,” said the NFIB of its April confidence index. “This suggests that the bulk of new hiring is happening in larger firms and the smaller counterparts on Main Street – the ones traditionally responsible for leading the country out of recessions, are still struggling to hire.”