NFIB Data Says It’s Only An Economic Recovery

The recent NFIB survey suggests we are only in an economic recovery, not an expansion. Such was a point I made with Daniel Lacalle in a recent podcast.

While the mainstream media overlooks the NFIB data, they really shouldn’t. There are currently 30.7 million small businesses in the United States. Small businesses (defined as fewer than 500 employees) account for 99% of all enterprises, employ 60 million people, and account for nearly 70% of employment. The chart below shows the breakdown of firms and jobs from the 2019 Census Bureau Data.

NFIB Only Economic Recovery, #MacroView: NFIB Data Says It’s Only An Economic Recovery

We understand the importance of the data, which is why we regularly report on it. For example:

Our most recent report was at the end of January entitled: “NFIB Survey Warns About Small-Cap Stocks” Starting a little over a month later, small-cap stocks began to underperform the major index.

The most recent survey for April 2020 is sending some important messages that differ from what we hear from the mainstream media:

  1. The “confidence” of an economic recovery is weak.
  2. Higher wages are not a significant concern.
  3. Businesses aren’t investing due to a lack of “real demand.”

Let’s dig in.