The National Federation of Independent Business (NFIB) released its monthly Small Business Economic Trends report this morning.

I’ve noted in the past that as an answer to the question, “What is your ‘single biggest problem,’” Poor Sales correlates very highly to the Unemployment Rate (0.88).  Poor Sales ticked down again this month, from 23 to 22, and is down from 27 one year ago.

Glacial progress.

Category: Consumer Spending, Data Analysis, Economy, Employment

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

8 Responses to “NFIB Correlation: Retail Sales & Unemployment Rate”

  1. wally says:

    More people with money to spend = more money spent.


  2. PeterR says:

    Interesting chart. Thanks.

    The 2009-to-present spikes up in both lines are, so to speak, off the chart, and it will be interesting to see what happens in the next year or two, as these lines approach “support.”

    “Support” generally speaking (based on previous highs from 1986 to 2008) is around 7.0 on the Unemployment Rate, and about 20 on the Poor Sales line in red.

    If both lines “find support” is the current market rally in jeopardy?

    Have retail sales peaked? If so, the support referred to above may take hold?


  3. Francisco Bandres de Abarca says:

    Well, at least Beatrice is leading our hero out of economic Purgatory, be it ever so slowly.

  4. yon QOTD..

    Faced with the choice between changing one’s mind and proving that there is no need to do so, almost everyone gets busy on the proof.

    —John Kenneth Galbraith

    we may care to wonder why JMK is, so, much more popular than JKG ..

    it is, yet, another ‘mistake’..

  5. Futuredome says:

    The early 90′s was slow as well. From the beginning of the slowdown in Q3 1989 to Q3 1993 it was quite the struggle. Then came the steady “recovery” in full before the boom hit in the 2nd half of 1997.

    This is like a bigger version of it(and will take longer to hit “Q4 1993″.

  6. rd says:

    This graph is clearly incorrect or is just another correlation without causation thing.

    The whole concept of the Bush tax cuts and trickle down economics theory is that it doesn’t matter how many people have money to spend, it only matters how much there is to spend.

    Therefore, the unemployment statistics are irrelevant as long as the wealthy can get their share of income that the unemployed people would otherwise be earning.

  7. colin says:

    Quick question –

    Is the 0.88 a correlation of the levels (spurious statistic) or the change in levels (what people mean when they say correlation). The correlation looks much lower than the 0.88 cited, save the visual appear above. I’d suspect the relationship is much more slack than 0.88 would suggest.

    Invictus: What I posted is the correlation coefficient returned by Excel’s CORREL function.

  8. colin says:

    You should only use CORREL on changes in data, not the raw data itself: