One thing is for sure – Democrats and their reckless policymaking has left us with nothing but terrible economic headwinds. Thanks to their efforts, this holiday season will be one of the most expensive on record for American families. What Biden and his Democrat allies fail to highlight is the staggering inflation rates for items like shelter, energy, and groceries. If you use propane, you are paying 65.7% more than you did last year to heat your home or business this winter. Overall, folks are paying 7.1% more than they did one year ago. The damage has been done. Two years of reckless spending has consequences and American families and Main Street businesses are paying the price. This is not sustainable
The below December 2022 Small Business Snapshot features numbers and news updates to provide more insight into the current small business economy.
MAIN STREET MEASUREMENTS:
CONSUMER PRICE INDEX (INFLATION)
- The prices consumers paid for goods and services increased .1 percent in November as compared to October but totaled a 7.1 percent increase when measured over the last 12 months.
PRODUCER PRICE INDEX
- Wholesale prices increased .3 percent in November but registered an increase of 7.4 percent year over year.
- At the end of October, businesses were unable to fill 10.3 million jobs and 4.0 million workers quit their jobs.
- 263,000 jobs were created in November, and the unemployment rate remained unchanged at 3.7 percent. 6.0 million Americans are unemployed.
LABOR FORCE PARTICIPATION RATE
- The labor force participation rate decreased to 62.1 percent in November.
UNEMPLOYMENT INSURANCE WEEKLY CLAIMS
- For the week ending December 10, 2022, the Department of Labor reported that initial unemployment claims were 211,000.
PERSONAL CONSUMPTION EXPENDITURES PRICE INDEX (CORE PCE which excludes energy and food)
- The core PCE price index decreased to 5.0 percent in October when measured year over year.
BUSINESS FORMATION STATISTICS
- Business formation applications totaled 418,905 in November marking a decrease of 3.1 percent over last month.
HIGH PROPENSITY BUSINESS FORMATION STATISTICS
- New businesses categorized as having an increased likelihood of having employees and a payroll, otherwise known as High Propensity Businesses, totaled 138,420 (a decrease of 2.7 percent) in November.
- The initial consumer sentiment reading for December registered 59.1. In comparison, the December 2021 reading was 70.6.
COMMERCIAL AND INDUSTRIAL LOAN DATA
- As of December 9, 2022, commercial and industrial loans totaled $2.814 trillion.
SBA LENDING DATA
- The SBA approved a total of $5.2 billion 7(a) Loans through December 9, 2022.
NEWS YOU CAN USE:
Job Creators Network: November 2022 Job Creators Network Small Business Monthly Poll (HERE)
- “63% of small business owners say worsening economic conditions would force them to close their businesses.
- 70% of small businesses think the 2017 Tax Cuts and Jobs Act should be made permanent.
- Inflation continues to dominate small businesses’ concerns and 76% say the Biden administration is not doing enough to fight inflation.”
National Federation of Independent Business: Inflation Pressures Ease Slightly on Main Street but Remains the Top Business Problem (HERE)
- “Inflation remains the top business problem for small business owners, with 32% of owners reporting it as their single most important problem in operating their business, five points lower than July’s highest reading since the fourth quarter of 1979. The Small Business Optimism Index rose 0.6 points in November to 91.9. November’s reading is the 11th consecutive month below the 49-year average of 98.
- Forty-four percent of owners reported job openings that were hard to fill, down two points from October, but historically high and not typical of a recession period.
- The net percent of owners who expect real sales to be higher improved five points from October to a net negative 8%, a weak economic reading.”
S&P Global Market Intelligence: Hiring struggles at small businesses drive historically tight US labor market (HERE)
- “Small businesses appear to be struggling more to hire workers than larger companies as overall job openings continue to outpace people looking to fill those positions.”
- “Relatively small companies, those with fewer than 250 employees, accounted for nearly 80% of the 10.3 million job openings reported by the U.S. Bureau of Labor Statistics at the end of October. The small-business sector has 3 million more job openings than before the COVID-19 pandemic.”
- “Smaller companies might be able to compete with larger firms on wages, which continue to rise. Still, they cannot offer comparable benefits, particularly health insurance, which has seen significant cost increases.”
- “With fewer workers, smaller businesses have begun limiting their hours and days of operation. Some have begun scaling back their services and goods sold.”
Yahoo Finance: New income tax rules may be ‘burdensome’ on small business owners-Expert (HERE)
- “Small business owners who use fintech platforms like PayPal, Venmo, and Cash App to complete transactions must be mindful of a new reporting rule from the IRS. As a result of the American Rescue Plan Act, anyone earning over $600 for a business-related transaction will have their income reported to the IRS.”
Fox Business: Inflation eases more than expected in November to 7.1%, but consumer prices remain elevated (HERE)
- “Inflation moderated more than expected in November, an early sign that painfully high consumer prices are beginning to loosen their stranglehold on the U.S. economy.”
- “Consumers paid more for items like cereal, rice, bread, fresh fish and seafood, eggs, milk and fresh vegetables, including tomatoes and lettuce.”
- “Shelter costs, which account for about 40% of the core inflation increase, rose 0.6% for the month and are up 7.1% over the past year, the fastest annual increase since 1982. Rent costs jumped 0.6% over the month and 7.2% on an annual basis.”