In a speech to the Chamber of Commerce last month, President Obama proclaimed, “Now is the time to invest in America.” A National Federation of Independent Business (NFIB) survey shows small businesses aren’t buying it.
Last year was a flat one according to NFIB’s Small Business Optimism Index, revealing no net gain for the calendar year. A year-to-year comparison revealed that “no progress was made in 2011,” according to NFIB Chief Economist Bill Dunkelberg. “This does not make for a comforting future, a fact reflected by low consumer and small-business owner optimism.” This pessimistic outlook isn’t projected to change for 2012. According to a report accompanying the data, the survey indicates that the weak economy will continue to hobble along at a slow pace.
“January  small business economic trends were no better than 2011,” NFIB President Dan Danner told The Washington Times. “Our small-business owners’ expectations of the overall business environment haven’t gotten any better in the last year … there are more of them that say they’re going to lay employees off over the next couple months than hire. Their overall outlook for the next six months is slightly negative. So our guys are still not seeing the recovery. And the administration and others [say] that uncertainty is not a factor but for them it is the factor.”
Health care, the regulatory environment and taxes are the three main areas depressing business expectations, according to Mr. Danner. Small-business owners are seeing their health-care premiums spike by as much as 20 percent. The Obama administration still hasn’t decided what will be required in a minimum benefits package, which increases anxiety by business owners who can only guess at the punishment that’s coming. Such uncertainty leads businesses to hold onto their money instead of spending it on hiring new people or projects because they don’t know what the future will bring and how much their costs will increase.
Having to plan according to worst-case scenarios doesn’t inspire the confidence needed to make the sort of risky investments required to produce robust economic growth. “The scope and breadth of the regulatory burden are having a crippling effect on job creation and small business as a whole,” Utah Sen. Orrin Hatch said in a Feb. 14 speech. “Ultimately, this is a tragedy for young men and women just entering the labor force, for families struggling to get by, and for entrepreneurs who are prevented from growing businesses due to these regulatory burdens.”
To top it off, small-business owners know that this president is decidedly not in their corner, so any efforts by Congress to alleviate small-business burdens wind up at the same dead end on 1600 Pennsylvania Avenue. The over 350,000 members of NFIB “don’t believe this president will sign much that is small-business friendly,” said Mr. Danner. “When you look at this environment out there of an out-of-control government, they’re pretty hesitant to invest, so they’re sitting on the sidelines, they’re not investing, they’re not creating jobs and they’re not very optimistic.”
Among these dark economic storm clouds, there is a silver lining. Small-business owners are discussing the upcoming election when they will cast their votes for president. When they do, what they talk about is change.
Anneke E. Green is Assistant Editorial Page Editor for The Washington Times. Follow her on Twitter: @AnnekeEGreen