Dark clouds hang over U.S. small businesses

"Small business owners entered 2010 the same way they left 2009 -- depressed," the group said, noting its Small Business Optimism Index reading for January was still below the 90 mark, the dividing line between positive and negative outlooks."

"In January, small businesses had to cut prices despite tangling with inflation while profits remained weak, according to the survey of the federation's 2,114 members."

"There are "still more owners planning to reduce stocks than planning new orders," the group found."

Source: Reuters


Remember that small businesses generate most of the job creation in the United States.

Even as a number of temporary help providers have exceeded estimates, there still continues to be lax growth in sales.

Monster, Inc. announced a large acquisition of Hotjobs which I am not a fan of. They seem to have overpaid for the Hotjobs property even though it is under the price of the prior bidding war with Yahoo.

In the near term there should be underlying risk for these companies as the stimulus and low interest rates start to fade with increased regulations and reform.

Jobs data propel staffing stocks, risks remain

"Tig Gilliam, who heads North American operations for global staffing giant Adecco SA, said the industrial part of the temporary labor market normally rebounds strongly at the end of recessions, but he has not yet seen evidence of that.

Jobs associated with the physical supply chain will recover as inventories get run down and need to be restocked, Gilliam said, but he added:

"The only place we're seeing the reaction you'd expect there is in automotive, and what scares me is that's artificial. (The) cash-for-clunkers program accelerated demand in that segment."

Source: Reuters