US Small Businesses Report Poor Sales
11% of US small businesses reported "poor sales" as their top issue in February, nearing 2020 highs and tripling over three years. The Kobeissi Letter predicts unemployment could exceed 5% soon, the highest since mid-2021. This is a concerning trend for the overall economic health of the country.
To understand the rise in "poor sales" reports, consider that small business optimism has been below its 50-year average for 26 consecutive months. February's report from the National Federation of Independent Business (NFIB) indicated that owners anticipating better business conditions over the next six months fell by four points, reaching a net negative 34%. That pessimism is reflected in hiring plans; 17% of owners plan to create new jobs, down two points from January. Meanwhile, 42% reported job openings they couldn't fill. The Kobeissi Letter's unemployment prediction aligns with recent jobless claims data. The week ending May 11, 2024, saw initial claims increase by 22,000 to 242,000, the highest level since August 2023.
