While you may have thought the biggest news of the week was Joe Biden playing the Democrat’s Frank Underwood in 2016, the National Federation for Independent Businesses (NFIB) gave us the best news on Tuesday with it’s July Small Business Optimism Index. It showed an increase in optimism of 4.3 percent from June’s 15-month low to July. For us, that’s more golden than The Donald’s toupee. One in four businesses said they were hiring and capital spending plans suggest future spending increases.
Small business is the true Thomas the Train of this economy and we’re huge fans. We put a lot of weight in this report because if small business, with its smaller margins, feels happy, that’s better than The Great Rodent Accords. We need more months of this report being positive, though.
On Wednesday, the Labor Department released its June Job Opening and Labor Turnover Survey (JOLTs). Job openings contracted to 5.249 million on the last day in June, compared to 5.363 in May. The job openings rate increased to 3.7 percent from 3.6, while the layoff rate was up to 1.3 percent from 1.2. The quits rate remained flat, but faired better than the Chinese yuan.
Like the narrowly focused and conveniently redefined official unemployment rate saw last week, this more granular report has seen a tepid 2015.
Finally on Friday, the University of Michigan released its August mid-month Consumer Sentiment Index, which showed a slight drop to 92.9 from July’s final 93.1 report. The current conditions and inflation components are little changed, while the perpetually ominous future expectations component dropped three-tenths of a point.
Small business is happier, but there are still concerns in job market fundamentals, as suggested by Wednesday’s JOLTs. If Bernie Sanders could get more than a side-eye from the media, his take that real unemployment is around 10 percent would make people question the official data.
What’s this means for those of us not regularly on Drudge? While smaller businesses are happy, don’t join that new start-up just yet. Production has increased, which is good. Though final production output costs have stayed steady, initial production costs have increased. Business inventories in all categories, though mostly autos, are up. This is a concern for the long-term job stability. If I had to play Greenspan and create our own words, we’d say things are tenuously buoyant.
Back to school shopping is over, so cut spending, but brace yourself for the pending holiday season. It’s almost time to mail your Halloween cards, don’t you know? Set a family goal to spend no more than $20, $50 or $100 a week to save cash. Then, hide the difference from yourself in a bank or credit union account or, better yet, invest it in diversified investments. If you want ideas to make this strategy work for you, see our videos on Money Chunking and Budget Creep.
That’s this week’s Money Conscious Mash Up. Come back every Sunday for our slightly offbeat take on the topic about which that little, blonde haired lady’s always talking to Congress.