Is America’s swagger back? Americans felt better about the economy last year. Gallup found that for the first time since it started measuring economic confidence in 2008, “Americans' views of the U.S. economy were positive on balance in 2017.”
There’s similar positivity among business.
The Q4 MetLife & U.S. Chamber of Commerce Small Business Index showed a second consecutive quarter of growing confidence, mostly from brighter attitudes toward their local economies with “more than half (57%) think[ing] they will see an increase in revenue, and a quarter plan[ing] to increase their investments in the next year.”
Mid-sized businesses also are confident. The Q4 RSM U.S. Middle Market Business Index hit a record high last month. Two-thirds of mid-sized businesses expect higher revenues and profits over the next year, and more than half expect to hire more workers.
Manufacturers are also part of this trend. The latest National Association of Manufacturers’ survey of 14,000 manufacturers found record-high levels of optimism—94.6% had a positive outlook on the economy. And a key manufacturing indicator, the ISM Manufacturing Purchasing Managers’ Index (PMI), found "new orders increasing at their fastest pace since January 2004."
Economic numbers show this isn’t some Pollyannaish view. For the first time since 2014, GDP grew by at least 3% for two straight quarters.
Accomplishments in Washington last year should sustain economic optimism. The first major tax reform in a generation became law. It cuts taxes on businesses of all sizes, leading to increased investment and higher workers’ wages.
One New York small business owner told me he thinks tax reform “will trigger a tremendous amount of growth.”
Also, Congress’ and the Trump administration’s work in reducing regulatory burdens will boost economic growth and improve U.S. global competitiveness.
We see business confidence spilling over into 2018 with businesses large and small already announcing bonuses and new investments in light of tax reform becoming law.
For the first time in years, businesses feel like they have some wind at their backs. It helps when they know there’s a Congress and president standing up for them.
As Washington works on key issues this year like trade, infrastructure, and continuing to reduce regulations, keeping a pro-growth focus will pay off with a stronger economy and a more self-assured public.