Small business optimism in the U.S. rose more than expected in April, as companies increased plans to hire and invest, according to a private study released on Tuesday.
The National Federation of Independent Business said its monthly Small Business Optimism Index rose two points last month to 94.5, the gauge's highest reading since December 2007. Analysts surveyed by Bloomberg News expected a reading of 93.
The index also hit the December 2007 level in February 2011, after which it slipped before regaining ground it lost last month.
The net percent of all owners reporting higher nominal sales over the past three months gained another 3 points to 4 percent, the NFIB said in a statement.
This comes after a surprising eight-point gain in March, one of the only positive trends for that month. Nineteen percent of owners still cite weak sales as their top business problem, a high reading, but far below the record 33 percent reading from December 2010. Sales are improving broadly in the small business sector, albeit not dramatically, the NFIB said.
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The group also said that while firms surveyed have eased up on layoffs, they have not resumed strong hiring.
While the index remains historically weak, there was good news in the details of April's report. Job creation plans, job openings and capital spending plans all increased. Hopefully, this performance will hold in the coming months, NFIB Chief Economist Bill Dunkelberg said in a statement.
However, GDP and employment growth news has not been good; the euro debt crisis continues to make news and Congress leaves us on an identical path: huge deficits, a terrifying amount of liquidity at the Fed and no indication that anything positive will be done.