Is the Small Business Economy Growing Fast Enough?
It has been known for several years now that this current economic recovery would require raw net growth from the small business economy. Many large businesses have continued to keep their payrolls low or have been slow to add to R&D and capital spending. A new report suggests that the small business economy continues to grow modestly, according to Newtek's July 2014 SB Authority Index.
Newtek Business Services' SB Authority Index of small business indicators shows that the index hit 128.72 for July 2014. The index was up 0.7% from June 2014, but on a year-over-year basis it was up 6.98%. Leading the increase were approved SBA lending volumes, the Russell Microcap Index and Newtek Merchant Processing volume.
Barry Sloane, who is chairman, president and CEO of the Small Business Authority, said:
The small business economy seems to be picking up a little bit of steam, despite a lack of robust growth in new employment hires. The low interest rate environment continues to make the financing market for equity and debt fertile, as well as encourages consumers to spend instead of save.
So, what are other things looking like in the world of small businesses? On September 2 we showed separately how the Paychex reporting indicated that small business hiring looked less robust in August. We also showed last month that the National Federation of Independent Business (NFIB) said its Small Business Optimism Index technically rose 0.7 points to 95.7 in July.
The good news is that small business growth continues. The bad news is that small businesses in America might not be growing fast enough to make up for the business losses that could be expected as a side effect of the slowing business trends in Europe.
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Filed under: Economy