May 11 (Bloomberg) -- Confidence among U.S. small businesses owners rose in April to the highest level since September 2008 as projections for profits, sales and the economy improved. The National Federation of Independent Business’s optimism index rose to 90.6 from 86.8 in March, the Washington-based group said today. Its measure of sales climbed to the highest level since the recession began in December 2007.
The index remains below levels associated with past economic recoveries, indicating the rebound in growth will take time to develop. The report showed the employment outlook was negative in April for the 17th time in the past 18 months.
“The recovery is going to be sub-par in comparison to the recoveries we experienced following past severe recessions,” chief economist William Dunkelberg said in a statement.
Nine of 10 index components rose and one was unchanged. The measure of earnings expectations showed the biggest increase in April, rising 12 points to minus 31 percent.
The net percent of owners projecting higher sales, adjusting for inflation, rose to 6 percent in April from minus 3 percent a month earlier. Those expecting better business conditions six months from now climbed to zero from minus 8 percent in March.
A gauge of whether firms think it is a good time to expand rose 2 points to a net 4 percent. The survey’s net figures are calculated by subtracting the percent of business owners giving a negative answer from those giving a positive response.
Not Hiring
A net minus one percent plan to create new jobs over the next three months, up one point from March. Eleven percent said they currently had job openings that were hard to fill, up from 9 percent a month earlier and “historically still very weak,” Dunkelberg said.
Plans for capital investment were unchanged with a net 19 percent expecting to buy new equipment or expand facilities over the next few months.
“With all the good news about the economy and GDP growth, it is not immediately obvious why owners remain so pessimistic and unwilling to commit to new spending,” Dunkelberg said.
The NFIB report was based on 2,176 responses through April 30. Small businesses represent more than 99 percent of all U.S. employers and have created 64 percent of all new jobs in the past 15 years, according to the U.S. Small Business Administration.
