Free Republic
Browse · Search
Topics · Post Article

Skip to comments.

Small-business confidence drops to lowest level in eight months (Hiring impulse dropped sharply)
Hotair ^ | 07/11/2012 | Ed Morrissey

Posted on 07/11/2012 7:23:46 AM PDT by SeekAndFind

Yesterday, Barack Obama responded to criticism of his plan to hike taxes on those earning as little as $250,000 a year --- a class which includes a large number of small-business owners --- by claiming that those entrepreneurs have no greater friend than the current President. He pointed to a number of tax breaks and credits he championed for small businesses, and dismissed the effects of hiking their taxes now:

Now, we can already anticipate — we know what those who are opposed to letting the high-end tax cuts expire will say. They’ll say that we can’t tax “job creators.” And they'll try to explain how this would be bad for small businesses.

Let me tell you, the folks who create most new jobs in America are America’s small business owners. And I've cut taxes for small business owners 18 times since I've been in office. (Applause.) I’ve also asked Congress repeatedly to pass new tax cuts for entrepreneurs who hired new workers and raised their workers’ wages.

But here's the thing that you have to remember. The proposal I make today would extend these tax cuts for 97 percent of all small business owners in America. In other words, 97 percent of small businesses fall under the $250,000 threshold. (Applause.) So this isn’t about taxing job creators, this is about helping job creators.

Apparently, job creators aren't buying that argument. The latest report from the National Federation of Independent Business shows a drop in optimism to the lowest level in eight months among small-business owners, and the inclination to hire falling even further:

The National Federation of Independent Business’s Small Business Optimism Index fell to 91.4 in June, down 3 points from May, according to data released Tuesday. Economists had predicted a milder fall to 93.

A sub-index that tracks expectations about economic and business conditions over the next six months sank eight percentage points to -10%, after rising three points to -2% in May. (Overall optimism slipped in May, but only slightly.) Another sub-index that tracks plans to hire dropped three percentage points to 3% in June after rising one percentage point in May.

Small businesses said “weak sales” were their most pressing problem and that they weren’t adding a lot of jobs and not planning to in coming months. “After a somewhat promising start, owner optimism has reversed trend solidly,” the NFIB’s chief economist William Dunkelberg said. “The June results were an economic downer.”

The NFIB notes that confidence dropped in nine out of ten categories — with credit being the only upside:

There was no good news in the June survey. The Small Business Optimism Index posted a decline of 3 points, falling to 91.4. This is a clear indication of slow growth. Only one of the ten Index components improved, expected credit conditions. Labor market indicators, spending plans for capital equipment and inventories took a drubbing, accounting for about 40% of the decline. Neither the Supreme Court’s decision on healthcare nor the highway spending bill effects are included in the June data….

The 10 Index questions lost a total of 30 percentage point in net favorable responses. The impact of the SCOTUS decision on health care will show up in the July survey as it occurred late in the month, ditto for the transportation bill which didn’t make much of a news splash. The health care decision was probably not what most owners expected, so “disappointment” over that will be reflected in the July survey responses. With over 20 new taxes ($800 billion) and most of the regulations yet to be written by HHS, the implications for employee costs remain unclear.

Pile onto that a President looking for a tax hike down to the $250K level, and it’s no wonder small businesses are feeling a lot more pessimistic. Given that even Obama acknowledges that the engine of job creation is small business, one might think that a President who needs to start seeing better jobs reports ASAP would try to reduce the fiscal and regulatory burdens that these entrepreneurs face rather than escalate them. Unfortunately, Obama seems more inclined to play class-warfare games than to get job creation back on track — and these small business owners know it.

TOPICS: Business/Economy; Culture/Society; News/Current Events
KEYWORDS: business; confidence; hiring; jobs

1 posted on 07/11/2012 7:23:57 AM PDT by SeekAndFind
[ Post Reply | Private Reply | View Replies]

To: SeekAndFind

Don’t worry- it’ll get better for small businesses once Obamacare and the Obama small-business tax hike kick in... (/sarc)

2 posted on 07/11/2012 7:44:09 AM PDT by Qbert ("The best defense against usurpatory government is an assertive citizenry" - William F. Buckley, Jr.)
[ Post Reply | Private Reply | To 1 | View Replies]

To: SeekAndFind

But it’s a step in the right direction!!!

3 posted on 07/11/2012 7:55:15 AM PDT by wny
[ Post Reply | Private Reply | To 1 | View Replies]

To: SeekAndFind

Anyone remember the last 6 weeks of the 2008 campaign where Obama touted his “Middle Class Tax Cut”. All the ads had a website address where you could go and figure your tax cut. How did that work out for everyone? I heard him yesterday touting the same thing. I wonder how many fools will believe him this time?

4 posted on 07/11/2012 8:05:42 AM PDT by anoldafvet
[ Post Reply | Private Reply | To 1 | View Replies]

To: Qbert

It’s almost like he’s trying to destroy the country...

5 posted on 07/11/2012 8:32:52 AM PDT by GOPJ (Marion Berry: “If you take out the killings, Washington actually has a very very low crime rate”)
[ Post Reply | Private Reply | To 2 | View Replies]

To: SeekAndFind

I am already noticing some small businesses, mainly restaurants, who have hastily decided to shutter. I think America is going to get a massive demonstration of what Going Galt means between now and Election Day.

6 posted on 07/11/2012 8:36:54 AM PDT by Buckeye McFrog
[ Post Reply | Private Reply | To 1 | View Replies]


baraq said he would reward his friends and punish his enemies.

It is pretty clear who his enemies are.

7 posted on 07/13/2012 5:20:44 AM PDT by Texas resident (November 6 - Vote Against obama)
[ Post Reply | Private Reply | To 5 | View Replies]

To: Texas resident

Small business people, traditional Americans, two parent families with Children, Christians, the elderly, conservatives, gun owners, Catholics, Republicans...

8 posted on 07/13/2012 6:04:50 AM PDT by GOPJ (Innocent people dying was the objective of Fast and Furious, not collateral damage. -Ann Coulter)
[ Post Reply | Private Reply | To 7 | View Replies]

Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.

Free Republic
Browse · Search
Topics · Post Article

FreeRepublic, LLC, PO BOX 9771, FRESNO, CA 93794 is powered by software copyright 2000-2008 John Robinson