1. THE ELECTION, SMALL BUSINESS, AND THE ECONOMY
WILLIAM DUNKELBERG
CHIEF ECONOMIST, NFIB PROFESSOR OF ECONOMICS EMERITUS TEMPLE UNIVERSITY

2. SMALL BUSINESS FACTS 90% OF ALL EMPLOYERS HAVE FEWER THAN 20 EMPLOYEES
PRODUCE HALF OF THE PRIVATE SECTOR GROSS DOMESTIC PRODUCT
EMPLOY 50%+ OF PRIVATE SECTOR EMPLOYEES
PRODUCE 2/3RDS OF THE NEW JOBS

3. TWO WAYS OUT, NEITHER DESIRABLE

5. Young Ben

6. RATING OF GOVERNMENT POLICY

7. MOST IMPORTANT PROBLEMS
1. RISING HEALTH CARE COST (1)
2. COST OF REGULATIONS AND RED TAPE (5)
3. FEDERAL TAXES ON BUSINESS INCOME (6)
4. UNCERTAINTY ABOUT THE ECONOMY (2)
5. TAX COMPLEXITY (7)
6. UNCERTAINTY FROM GOVERNMENT POLICY(4)
7. FREQUENT CHANGES IN THE TAX CODE (8)
8. PROPERTY TAXES (9)
9. STATE TAXES ON BUSINESS INCOME (10)
10. FINDING QUALIFIED LABOR (32)
(2012 RANK)

8. UNCERTAINTY UNCERTAIN CERTAIN (GOOD OR BAD)
SUM OF “DON’T KNOW” “UNCERTAIN” ANSWERS ON 6 QUESTIONS
UNCERTAIN
CERTAIN (GOOD OR BAD)

9. JOB GROWTH IN TWO NBER RECOVERY PERIODS, 1983 AND 2009
AVERAGE 689,000
AVERAGE 438,000 (535,000)
QUARTERS OF RECOVERY
GDP GROWTH: “83” 4.5% “09” 2.1%
HAVER ANALYTICS

10. REAL GDP GROWTH IN NBER EXPANSION PERIODS
THE WEIGHT OF
GOVERNMENT

11. SMALL BUSINESS OPTIMISM INDEX (QUARTERLY, 1986 = 100)
PEAKED Q1/2015 AS DID UofM

12. GDP GROWTH RATE (QUARTERLY AT ANNUAL RATES)
HOUSING
MFG/EXPORT
NFIB DATA FIRST MONTH EACH QUARTER

13. EXPECTATIONS FOR BUSINESS CONDITIONS IN 6 MONTHS (PCT “BETTER” - PCT “WORSE”)

14. EXPECTED BUSINESS CONDITIONS IN 6 MONTHS
OCTOBER
PERCENT OF FIRMS NSA

15. OUTLOOK FOR BUSINESS EXPANSION (PCT “NOW IS A GOOD TIME”)
“NO” for 30 QUARTERS

16. BAD TIME TO EXPAND DUE TO THE POLITICAL CLIMATE
% OF THOSE SAYING “BAD TIME”

17. REPORTED CHANGE IN PAST SALES (last 3 months vs prior 3)
RECESSION ENDS

18. EXPECTED REAL SALES

19. “EXCESS” DEBT: PAYING FOR THE “PARTY”
MAINTAINING DEBT/INCOME RATIO IN 1999
HAVER ANALYTICS

20. THE DEBT DEATH SPIRAL

21. Consumer Net Worth
BELIEVABLE???
HOUSING
DOT COM

22. Consumer Net Worth Relative to GDP
BUBBLE????
BUBBLE
BUBBLE
AVERAGE
RECESSION

24. REGULAR BORROWING ACTIVITY (AT LEAST ONCE A QUARTER)

25. SMALL BUSINESS CREDIT PROBLEMS (% HARDER TO GET - % EASIER)

26. ALL CREDIT NEEDS NOT SATISFIED

27. LOAN DEMAND: PERCENT NOT WANTING A LOAN
RECESSION STARTS

28. BILL PAYMENT, RECEIVABLES COLLECTION AND TRADE CREDIT
FIRST MONTH IN EACH QUARTER
NET % WITH A FAVORABLE RESPONSE

29. SINGLE MOST IMPORTANT PROBLEM FACING OWNERS
FIRST MONTH IN EACH QUARTER
CREDIT: NO PROBLEM

30. NET PERCENT REPORTING HIGHER INTEREST RATES [ ON THE LAST LOAN]

31. OUR UNCERTAIN MONTH TO MONTH MONETARY POLICY
Fed’s Mester Says Case for November Hike Will Likely Be Strong, Bloomberg.com: Economy, October 3, 2016
Fed’s Dudley Advises Caution in Raising Interest Rates, Bloomberg.com: Economy, October 3, 2016

32. NIRP
UNINTENDED
CONSEQUENCES

33. HOW HELPFUL IS FORWARD GUIDANCE
HOW HELPFUL IS FORWARD GUIDANCE? “But, if inflation were slightly above 2 percent even as unemployment remained far above levels consistent with maximum employment, then the unemployment consideration would dominate because we would be further from the unemployment objective than we are from the inflation objective.” NY NABE May, 2014

34. ACTUAL PRICE INCREASES SEASONALLY ADJUSTED
FIRST MONTH IN EACH QUARTER

35. CHANGES IN PRICES AND LABOR COMPENSATION
FIRST MONTH IN EACH QUARTER

36. UNFILLED JOB OPENINGS % WITH AT LEAST ONE UNFILLED OPENING

37. REASONS APPLICANT “NOT QUALIFIED”

38. JOB CREATION PLANS % PLAN INCREASE - % PLAN DECREASE

39. MOST IMPORTANT PROBLEMS
FIRST MONTH IN EACH QUARTER

40. AVERAGE CHANGE IN EMPLOYMENT PER FIRM

41. PREDICTED AND ACTUAL UNEMPLOYMENT RATE

42. PERCENT OF OWNERS INCREASING OR REDUCING EMPLOYMENT
FIRST MONTH IN EACH QUARTER

43. NET PERCENT OF OWNERS INCREASING EMPLOYMENT

45. ACTUAL CAPITAL OUTLAYS
LEASING ADDED
FIRST MONTH IN EACH QUARTER

46. PLANNED CAPITAL OUTLAYS (NEXT SIX MONTHS)

48. ACTUAL CHANGE IN INVENTORY (% INCREASING - % REDUCING)

49. INVENTORY INVESTMENT PLANS [% PLAN INCREASE – % PLAN DECREASE]

50. Quarterly ISM NON-MFG INDEX predicted by NFIB survey
Q3 NMISM READING
4Q FORECAST
BASED ON
OCT NFIB DATA
SURVEY FIRST MONTH IN EACH QUARTER

51. MOST IMPORTANT PROBLEMS
FIRST MONTH IN EACH QUARTER

53. ALWAYS FIND WAYS
TO MAKE YOUR JOB
INTERESTING

55. THE DEMOCRATS SWINGING FOR THE FENCE
TOOK THEIR EYE OFF THE BALL

56. TABLE

57. TABLE PRE AND POST ELECTION INDEX COMPONENTS

58. WWW. SMALLBUS. ORG for charts and report NFIB
for charts and report NFIB.ORG/RESEARCH many other reports and the monthly trends report