American small business owners are feeling the holiday cheer. In a national survey of over 5,000 respondents, November’s Small Business Economic Sentiment Index score bumped to 63.45, up two points from last month, and making it the highest score since August of this year. After four months in a row of declines, optimism among small business recovered somewhat from its annual low in October.
The uncertainty of the presidential race left professionals feeling shaky throughout the fall, and their optimism about the economy showed as much. But small business owners are feeling better about the economy in the aftermath of the election and things are looking up.
Historically, dips in sentiment are par for the course in the fall. In October 2015 economic sentiment was down across the board, and key indicators of economic pessimism — including hiring outlooks and expected earnings — closely mirror what we’re seeing this year. This is true of the November upswing as well, though sentiment remains lower this year than it was then, revealing a widening gap in how professionals feel year over year.
Holiday spending may also factor into how professionals are feeling. Small businesses across the board reported feeling more optimistic about their future financial situation in November, up considerably from a month before. With many professional forecasters optimistic that we’ll experience a boom in business this December, small business owners’ sense of financial wellbeing has improved. And if trends remain steady, economic sentiment is due for an even larger bump in January. Independent professionals tend to be at their most optimistic around the New Year.
Snow plow specialists in particular are feeling optimistic this November. And with good reason — with winter storms blowing through the Midwest and East Coast, snow removal is in high demand. Landscaping and lawncare professionals that transition to becoming snow plowers in the winter months are feeling the benefits of that spike. Chris, a Thumbtack pro based in Madison, WI, told us how he’s now started to focus his landscaping business on snow removal to help maintain a steady influx of customers, a wise strategy given that winter is already coming to the Badger State.
There have been some noteworthy exceptions to the recovery in optimism this November. Professionals in Massachusetts and Connecticut both felt worse this month than they did in October. Similarly, not all major cities experienced a rise in economic optimism this month: sentiment dropped in Boston, Los Angeles, Dallas, and Washington D.C. In the midwest, Wisconsin small business owners have remained neutral in sentiment since August.
Every month, Thumbtack’s Economic Sentiment Survey captures the attitudes and perspectives of thousands of business owners from across the country to gauge how they are feeling about the economy and their businesses. Now in its fourth year, this survey provides a unique vantage point on the economy, as respondents are largely mobile service professionals with five or fewer employees who operate in households across the United States. Because they are hard to reach, these professionals are frequently overlooked in other surveys of small businesses.