Board of Governors of the Federal Reserve System

Figure 1: NFIB survey results on most important problem for small businesses, selected categories

Monthly data, 1990-2011

Series: Weak demand; interest rates and finance

Horizon: 1986-2011

Description: Data are monthly and plotted as two curves. Units are percent. Generally, from 1986 through 2011, respondents to the NFIB survey indicated that weak demand was a more important problem than interest rates and finance. In mid-1988 through 1989, there were points in time when respondents indicated that interest rates and finance were a more pressing problem than weak demand.

The interest rates and finance curve starts at about 8 percent in the beginning of 1986. Over the entire period, interest rates and finance curve steadily declined from between 5 to 10 percent of respondents in 1986 to 3 to 6 percent of respondents in the early 2000s. The interest rates and finance curve ends at March 2011 at about 4 percent.

The weak demand curve begins at about 14 percent at the beginning of 1986. From 1986 through 2007, the weak demand curve fluctuated between 5 and 20 percent. However, from 2008 through early 2009, the curve increased to between 30 and 35 percent. Since the beginning of 2011, this number declined to 25 percent when it ends in March 2011.

The curves overlap in late 1998 through 1990, again in mid-1994 through early 1995, and once more in mid-2000.

Note: Respondents can report that their most important problem is: weak demand, interest rates and finance, inflation, taxes, government regulation, Cost and availability of insurance, quality of labor, cost of labor, completion from large businesses, and other. Not seasonally adjusted. Shaded areas denote National Bureau of Economic Research recession periods. These include mid-1990 to early 1991, early 2001 to late 2001, and late 2007 to mid-2009.

Source: National Federation of Independent Businesses (NFIB).

Figure 2: Credit more difficult to obtain than 3 months ago, net*

Monthly data, 1990-2011

Series: Percentage of firms who found that credit was more difficult to obtain than 3 months ago from 1990 through 2011

Horizon: 1990-2011

Description: Data are monthly and plotted as one curve. Units are percent.

The series begins at about 7 percent in 1990. From 1990 through 1999, the series declined gradually from about 5 percent to about zero, and then from 2004 through 2009, the percent increased to just under 16 percent . Since mid-2009, the series has tapered off. During all National Bureau of Economic Research recessions, the series increased, and during the latest recession, the series increased from 6.6 percent to 14.6 percent. However, since the end of this latest recession, the series decreased to 8.2 percent when it ends in March 2011.

*Of borrowers who sought credit in the past three months, the proportion that reported more difficulty in obtaining credit less the proportion that reported more ease in obtaining credit. Seasonally adjusted by the Federal Reserve Board. Shaded areas denote National Bureau of Economic Research recession periods. These include mid-1990 to early 1991, early 2001 to late 2001, and late 2007 to mid-2009. Return to text

Source: National Federation of Independent Businesses (NFIB).

Figure 3: Sales expected to increase over next 3 months, net*

Monthly data, 1990-2011

Series: Percent of firms who expect sales to increase over the next three months Horizon: 1990-2011 Description: Data are monthly and plotted as one curve. Units are percent. The series begins in 1990 at about 25 percent. From 1990 through 2007, the percent of firms who expect sales to increase over the next three months was positive and fluctuating between zero and 39 percent except for October of 2001 when it decreased to negative 0.87percent. The most recent recession was the first time that this series showed a significant portion of respondents feeling that sales were going to be lower over the next three months. In early 2009, this measure began to increase again after bottoming out at negative 27.9 percent and the series ends at 11.98 percent in March 2011, showing a positive outlook for higher expected sales for firms.

*Net percent of respondents that expect higher sales less the percent that expect lower sales in the next three months. Seasonally adjusted by the Federal Reserve Board. Shaded areas denote National Bureau of Economic Research recession periods. These include mid-1990 to early 1991, early 2001 to late 2001, and late 2007 to mid-2009. Return to text

Source: National Federation of Independent Businesses (NFIB).

Figure 4: Outlook for general business conditions 6 months from now, net*

Monthly data, 1990-2011

Series: Net percent of respondents who anticipate general business conditions to improve over the next six months from now

Horizon: 1990-2011

Description: Data are monthly and plotted as one curve. Units are percent.

The series begins in 1990 at about 1 percent. From 1990 through 1993, this curve varied between negative 23.5 percent and 40 percent. Then from 1994 through 2000, the outlook was tamed and only fluctuated between negative 19.4 percent and 11.1 percent. The curve increased from 2001 through 2003, reaching a high of 56.3 percent. This was followed by a decline, which reached a bottom of negative 20.1 percent in December 2007, the beginning of the most recent recession. The curve generally increases and ends the series at 8.4 percent in March 2011, which indicates that the majority of respondents believe that general business conditions will be better six months from now instead of worse.

*Percent of respondents that expect general business conditions to be better less the percent that expect conditions to be worse. Seasonally adjusted by the Federal Reserve Board. Shaded areas denote National Bureau of Economic Research recession periods. These include mid-1990 to early 1991, early 2001 to late 2001, and late 2007 to mid-2009. Return to text

Source: National Federation of Independent Businesses (NFIB).

Figure 5: Change in standards for commercial and industrial loans to small firms

Quarterly data, 1990-2011

Note: Shaded areas denote National Bureau of Economic Research recession periods. These include mid-1990 to early 1991, early 2001 to late 2001, and late 2007 to mid-2009.

*STDSSM = net % of banks tightening standards for approving C&I loans of small firms. Return to table

Source: Senior Loan Officer Opinion Survery on Bank Lending Practices, Federal Reserve Board.

Figure 6: Change in spreads of loan rates over cost of funds to small firms

Quarterly data, 1990-2011

Note: Shaded areas denote National Bureau of Economic Research recession periods. These include mid-1990 to early 1991, early 2001 to late 2001, and late 2007 to mid-2009.

*SPRDSM = net % of banks increasing terms - spreads of loan over banks' cost of funds - small firms Return to table

Source: Senior Loan Officer Opinion Survery on Bank Lending Practices, Federal Reserve Board.

Figure 7: Change in standards for commercial real estate loans

Quarterly data, 1990-2011

Note: Shaded areas denote National Bureau of Economic Research recession periods. These include mid-1990 to early 1991, early 2001 to late 2001, and late 2007 to mid-2009.

*STDSCOM = net % of banks tightening standards for approving commercial real estate loans Return to table

Figure 8: PayNet/Thomson Reuters SBLI* percent change vs. year prior

Monthly data, 2006-2011

Series: Small Business Lending Index percent change versus the year prior

Horizon: January 2006- February 2011

Description: Data are monthly and plotted as a bar chart. Units are percent.

The series begins in January 2006 at roughly 22 percent. From 2006 through September 2007 the year-over-year changes gradually decline until the most recent business cycle peak in December 2007. During the recession, however, the year-over-year changes in the Small Business Lending Index (SBLI) were increasingly negative until the business cycle trough, which occurred in June 2009. The series reached a bottom of negative 33 percent in April 2009. Then, shortly after the recent business cycle trough, the year-over-year negative changes in the index became smaller until they turned positive at about 5 percent in early 2010. The series reached a peak of approximately 21 percent in December 2010. In February 2011, the most recent month for which data are available and the last bar for the series shown in this figure, the SBLI measure of business loan and lease originations rose about 15 percent from a year earlier.

*SBLI Small Business Lending Index Return to text

Source: PayNet/Thomson Reuters

Figure 9: PayNet/Thomson Reuters Small Business Lending Index

Monthly data, 2005-2011

Series: Small Business Lending Index

Horizon: January 2005-February 2011

Description: Data are monthly and plotted as one curve. The curve is indexed to 100 in January 2005.

The series is a seasonally adjusted index and begins at 100 in January 2005. From 2005 through the end of 2006, this index increases to about 132. From 2007 through mid-2009, the index decreases by approximately 65 points to about 66, then reverses direction and has been increasing since this trough. The series ends in February 2011 at about 85.

This measure of lending, which allows comparisons across different months, has not yet rebounded to its level in mid-2007 even though many of the measures of small business owners’ and bankers’ perspectives have returned to their pre-recession levels. Despite the magnitude of the rebound, there has been an apparent turnaround in loan and lease originations using the seasonally adjusted Small Business Lending Index measure. These data add to the evidence that credit availability to small businesses is gradually improving.

Source: PayNet/Thomson Reuters

Figure 10. Change in demand for consumer and industrial loans

Quarterly data, 1991-2011

Note: Shaded areas denote National Bureau of Economic Research recession periods. These include mid-1990 to early 1991, early 2001 to late 2001, and late 2007 to mid-2009.

*DEMLGMED = net % of banks reporting stronger demand for C&I from large and middle market firms. DEMSM = net % of banks reporting stronger demand for C&I from small firms. Return to table

Source: Senior Loan Officer Opinion Survery on Bank Lending Practices, Federal Reserve Board.