BIG PICTURE: Statistics are just numbers, not rules. So what do the latest “bright spots” really mean for the direction of the economy?
I know a lot of you are still waiting for the economy to reignite. It has been almost two years since the recession began and it has to end soon, or so you would think. I read the latest survey conducted by the National Federation of Independent Businesses, and once again, historically, things are still heading in the wrong direction. I thought I would take the time to summarize the report for you:
- Business optimism has fallen to 86.8, a reading of fewer than 90 which is unprecedented. It lost another 1.2 points in March as the downward trend continues.
- Even with the stock market over 11,000 and the New York Times declaring the recession was over, small business still remains uncertain about the economy due to poor sales and credit issues.
- Good news, employment reductions per firm hit the “zero line” in March which was a good thing since it had been falling steadily every quarter since July 2008, which was the longest decline ever. The latest survey indicates that the employment decline trend may be over.
- While employment declines may have stopped, plans to create jobs in the next quarter among business is still at a negative 2%.
- Although there is good news about the economy, small business capital expenditures still remain just slightly above the survey’s 35-year low from last quarter. Small businesses still remain skeptical and very few businesses surveyed are considering new spending.
- Many small businesses are still reporting slower sales and negative sales increases.
- Prices are still heading downward due to the weak economy which is good news for businesses because there is little inflation.
- Small business earnings continue to decline, which is bad for small businesses because if they are not generating profits they too are not buying.
- Many businesses report that credit is still harder to get than it was when they last attempted and as I stated in last week’s article. This is due to a lack of request for monies for capital expenditures and expansion.
As I read this report, it becomes apparent that you can either be part of this continued trend or you can think outside of the box and figure out how to take advantage of this downturn and expand. We are all entrepreneurs, which means we are risk takers and have an abundance of creative energy. So why not do whatever it takes to reverse these trends?
I know that my company is looking for ways to expand and I have faith that we will succeed and so will you. There are so many wonderful ideas out there to investigate. I would recommend you begin to network with your fellow limousine service providers through local functions such as association and NLA meetings where you can find out what your competitors are doing and get it done.
— Jae Morey is vice president of business development with CheapLimoRates.com. He writes two separate blogs that focus on the limousine industry. “LIMO-U” is a blog that is educational in nature and covers numerous topics about how to use limousine services for various events and other industry related topics. His blog “The Limo Lane” is about all things limousine with topics that are of interest to limousine operators and industry customers.
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