The latest economic news makes it all too clear who the winners are in the U.S. economy. Small businesses are struggling to expand, while the biggest companies are growing even bigger. And a smaller percentage of the nation’s overall income is going to wage-earners.

 

“Fully 87% of our CEOs anticipate higher sales,” said Ivan Seidenberg, chairman of the Business Roundtable who also runs Verizon Communications. “As a result, more than half of our CEOs plan to increase both capital spending and U.S. hiring.”

 

Offsetting the rosy outlook of big business is the latest monthly survey from the National Federation of Independent Business (NFIB), a trade group consisting of small businesses across the United States. The NFIB May report says more small businesses plan to shrink their payrolls than those preparing to expand them. The number of small companies planning to expand hiring has been declining for months, with the previous low point coming last September.

 

But the biggest downturn news for the American workforce applies to the share of national income controlled by non-agricultural employees. This sector’s claim to the nation’s earnings has been declining overall for two decades, with some increases here and there. But since 2001, non-farm labor’s share has plunged straight down, according to the Federal Reserve of St. Louis.

-Noel Brinkerhoff

 

A Slowdown for Small Businesses (by Catherine Rampell, New York Times)

Business Roundtable Releases Second Quarter 2011 CEO Economic Outlook Survey (Business Roundtable)

Small Business Economic Trends (National Federation of Independent Business) (pdf page 12}

Nonfarm Business Sector: Labor Share (Federal Reserve Bank of St. Louis)