Econintersect: The National Federation of Independent Business (NFIB)’s May 2014 monthly optimism index declined from 96.6 to 95.0. The market was expecting the index between 96.0 to 98.0 with consensus at 97.0. Two index components improved, two were unchanged and six fell.
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NFIB reports usually contain blasts directed at Washington by NFIB chief economist Bill Dunkelberg.
The only two index components that increased in June were labor market indicators: the percent of owners with job openings and the percent planning to create new jobs in the coming months. While reports of actual net job creation per firm were positive, consumer and business owner optimism remain low, with both spending growth and sales expectations weak. This means there are more jobs but not much more output. With election day months away and no sign of change in Washington, economic growth for the rest of the year will continue to be sub-par. The unemployment rate will fall more due to people leaving the labor force than to jobs being created and fewer hands making GDP.
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Report Commentary from NFIB Chief Economist William Dunkelberg:
