In the July report, a few mention that they have been boosting prices.
According to the July monthly poll from NFIB, issued on Tuesday, small business owners reported somewhat higher aspirations for their companies over the next six months but simultaneously maintained their anxiety over inflation.
Despite being below the long-term average of 98, the small-business association said that small business confidence increased by 0.4 points last month to 89.9. However, small firms anticipating better economic conditions rose by 9 points, while reporting price increases fell by 7 points.
According to Bill Dunkelberg, chief economist for the NFIB, “the uncertainty in the small company sector is growing again as owners continue to confront unprecedented inflation, labor shortages, and supply chain disruptions.””Owners will continue to manage their firms into a very uncertain future as we move into the second half of 2022,” the report states.
A day before the government is scheduled to reveal the July consumer price index, the survey will be released. Economists anticipate a small decline to 8.8% in inflation following a June report that showed it running at an annual pace of 9.1%. Lower energy prices are probably a contributing factor to the drop.
Energy costs have significantly decreased recently, and they have been a big driver of inflation, according to Zach Stein, a chief investment officer of financial advisors Carbon Collective. As a result, he predicted that Wednesday’s inflation statistics will likely slow down. Prices have started to drop in some of the most resistant industries, such as real estate and used vehicles, which is encouraging for the theory that inflation has peaked.
Nevertheless, the Federal Reserve’s continued concern over inflation is both an economic and a political one for the White House. President Joe Biden has praised the improvement in the supply chain as well as the fall in gasoline prices, which have dropped by nearly 70 cents over the previous month.
Despite the economy contracting for a second straight quarter in the second quarter, a red-hot labor market figure of 528,000 new jobs generated in July has temporarily put a stop to talk of a recession. However, the economy remains unstable for both businesses and consumers.
Someone failed to notify the labor market if the US economy is slowing or heading into a recession, according to Andrew Patterson, the senior internal economist at mutual fund behemoth Vanguard. “With nominal pay growth still above 5%, average monthly job growth of 450k over the past six months, a historic amount of job listings, and little evidence of a cooling labor market,” Even though the labor market is frequently a lagging indicator, Patterson continued, “there’s little downside risk to the labor market in the next 24 months and the US may experience its first recession where the unemployment rate doesn’t rise above 5% in the modern economic era.” Long-term demographic and structural issues in the labor market also mean that this recession may be the first one in modern economic history.
