September 8, 2020
Small business optimism rose 1.4 points in August to 100.2 after having declined 1.8 points in July. But this series fell a total of 13.6 points in March and April. Seven of the 10 index components improved in August, 2 declined, and 1 was unchanged.
Chief Economist William Dunkelberg said, “Small businesses are working hard to recover from the state shutdowns and effects of COVID-19. \ We are seeing areas of improvement in the small business economy, as job openings and plans to hire are increasing, but many small businesses are still struggling and are uncertain about what the future will hold.”
We saw GDP decline 31.7% in the second quarter, the biggest drop in history. But fiscal stimulus funds has flowed into consumer and business hands and the economy is on the mend. While the economy fell into a recession in March, it turned upwards in May. In that case, it would be just a 2-month recession, which is less than one-half the duration of an average recession. We expect Q3 GDP growth to be 28% and growth in the fourth quarter of 7.0%.