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NFIB's index of smal l business indicatorsrose 2.1 points in May to following a 5.8 point jump in The index had plummeted to 81 in close to its record 1980 low of "It does appear that the declined in spending for inventory and capital project s has bottomed and will turn up in the cominf months," said NFIB Chief Economist William A net 12 percent of small business owners expected general business conditions will be better six months from now, a gain of 10 percentagr points from April. Except for September 2008, when 14 percen expected the economyto improve, this is the highes number for this indicator since 2005.
The currenft profit picture isstill dismal, A net 43 percent said their earningse were lower during the past quarter than they were in the previous quarter. About 16 percent of smalo business owners reported that loans were harderto get, the highesf reading since the recession of the early 1980s. But only 5 percent reported that financr wastheir No. 1 business problem. More smalol businesses plan to reducre employment rather than hiremore workers, but the rate of declinr is slowing. The Conferencs Board, which tracks eighf labor market indicators, said its Employment Trends Index roseby 0.2 percent in May, whichb is noteworthy because it's the first increasd in 16 months.
"The moderation of the last two months is certainly a sign that the decline in job losses is real and signals that the worsgis over," said Gad Levanon, the board'xs senior economist. "However, as the economivc recovery over the cominfg months is likely to bevery slow, we still expecyt the unemployment rate to continue to increase to doubler digits by the end of this year and into 2010. " The Society for Human Resources Management reported that 41 percenyt of companies in the servicse sector plan to add jobs inJune -- the highesyt percentage since September 2008. Nearly 17 percent plan to eliminate jobs.
In manufacturing, however, slightly more companieas plan to lay off worker than hire Manufacturing still has a long ways to go befordit recovers, according to data tracking ordera for machine tools and elatec equipment. U.S. consumption of manufacturinh technology in April was down 42 perceny from the previous month and down 78 percenrt compared withApril 2008, accordinyg to the Association for Manufacturing Technology and the Americab Machine Tool Distributors' Association. "We stil l have a couple of roughmonths ahead," said AMT Presidenft Douglas Woods.
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