Despite this uptick, inflation remains the primary concern for small business owners, with 22 per cent identifying it as their most significant issue. This is a three-point drop from March but still the leading problem for businesses.
Key findings from the NFIB's report include a six-point rise in the net percentage of owners expecting higher real sales, now at a net negative 12 per cent (seasonally adjusted). Additionally, a seasonally adjusted net 12 per cent of owners plan to create new jobs in the next three months, up one point from March’s lowest level since May 2020. Plans for price hikes dropped to a net 26 per cent, the lowest reading since April of last year. Job openings that could not be filled rose to 40 per cent, a three-point increase from March, reflecting the lowest reading since January 2021, as per NFIB.
Owners raising average selling prices fell three points from March to a net 25 per cent (seasonally adjusted). In the NFIB's monthly jobs report, 56 per cent of owners reported hiring or attempting to hire in April, with 91 per cent of those facing challenges finding qualified applicants.
Sales trends showed mixed results. A net negative 13 per cent of owners reported higher nominal sales over the past three months. The net percentage expecting higher real sales volumes rose six points to a net negative 12 per cent. Inventory levels also saw a net negative 6 per cent, with 12 per cent reporting stock increases and 17 per cent noting reductions. A net negative 4 per cent of owners viewed current inventory stocks as "too low," and a net negative 6 per cent plan inventory investment in the future.
In pricing, 13 per cent of owners reported lower average selling prices, while 41 per cent reported higher prices. Price hikes were most frequent in the wholesale (40 per cent higher, 10 per cent lower) sector. Seasonally adjusted, a net 26 per cent of owners plan price hikes.
Compensation trends remained stable, with a net 38 per cent of owners reporting raised compensation in April and a net 21 per cent planning to raise compensation in the next three months.
Labour costs emerged as a top concern, with 11 per cent of owners citing it as their primary issue, a one-point increase from March. Meanwhile, 19 per cent pointed to labour quality as their top problem, second only to inflation.
Profit trends were discouraging, with a net negative 27 per cent reporting positive profit trends, a slight improvement from March's figures. Among those reporting lower profits, 33 per cent attributed it to weaker sales, 14 per cent to rising material costs, 13 per cent to seasonal changes, and 12 per cent to labour costs. For those reporting higher profits, 43 per cent credited sales volumes, 26 per cent usual seasonal changes, and 11 per cent higher selling prices.
Financing remained relatively stable, with 3 per cent of owners reporting unmet borrowing needs, a one-point increase from March. Twenty-eight per cent reported all credit needs met, while 60 per cent were not interested in a loan. A net 8 per cent found their last loan harder to obtain compared to previous attempts, and 4 per cent cited financing as their top business problem. A net 21 per cent reported paying a higher rate on their most recent loan, up four points from March.
Fibre2Fashion News Desk (DP)