US: NFIB small business optimism index started 2018 on a high – Nomura

Analysts at Nomura note that in the US, NFIB small business optimism index started 2018 on a high note, increasing 2 index points to 106.9 in January.

Key Quotes

“The percentage of respondents reporting now is a good time to expand increased 5pp to 32%, the highest reading in the survey’s history. In terms of the most important problem for small businesses, taxes ticked down 2pp to 19%, while quality of labor increased 3pp to 22%, making quality of labor the most important issue and highlighting the tight labor market many employers currently face.”

“On another positive note, the percentage of respondents planning to make capital expenditures over the next three to six months increased 2pp to 29%, below the recent peak of 32% (August 2017) but a solid reading consistent nonetheless with the positive environment for business investment. The percentage of respondents with plans to increase employment remained unchanged at 20%. The net percent of firms raising worker compensation increased 4pp to 31%, the highest reading since December 2000.”