One key thing is missing from small business owners’ euphoria over Trump’s win

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Joe Raedle/Getty

Several surveys show that President-elect Donald Trump’s win was a confidence boost for business owners. However, they’re not immediately planning to invest more.

On Tuesday, the National Federation of Independent Business’ report on small businesses continued this trend.

“What a difference a day makes,” said Juanita Duggan, the NFIB CEO, in the release. “Before election day small business owners’ optimism was flat, and after election day it soared.”

The headline Small Business Optimism Index jumped by 3.5 points to 98.4. Like Wall Street, small business owners are betting that Trump’s promises to ease regulations and cut taxes would support their bottom lines.

In fact, compared to the bigger companies – whose shares have rallied since the election – small business owners are likely more excited about these prospects because they have less muscle to cope in the current environment.

“Federal taxes, regulations, and Obamacare are the three biggest impediments to running a small business in America,” Duggan said, highlighting three key ingredients of Trump’s policy proposals.

“Small business owners have high expectations that those problems will be addressed.”

But the one thing businesses are not saying post-election is that they want to spend more.

The improvement in sentiment “doesn’t seem to have been enough to convince small firms to step up their plans for investment,” said Andrew Hunter, a US economist with Capital Economics. “The investment intentions sub-index actually declined to 24, from 27, leaving it consistent with a stagnation in business equipment investment.”

The charts below show that while optimism has improved …

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Capital Economics

… spending plans have declined (overall business-equipment investment has declined for the past four quarters):

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Capital Economics

Frances Donald, a senior economist at Manulife Asset Management, tweeted details from the NFIB survey, which show that companies are also not planning to raise wages:

It’s likely that business owners are waiting for more clarity on the timeline for when Trump’s promises will be actualized, and if they ever will.