Fiserv Launches First-of-its-Kind Index to Measure U.S. Small Business Performance at National, State, and Industry Levels
- The Fiserv Small Business Index provides timely insights into consumer spending activity, empowering users to respond to emerging trends.
- The index is derived from point-of-sale transaction data, providing a reliable new signal of the performance of U.S. small businesses.
- The December 2023 Fiserv Small Business Index shows a modest upswing in small business spending, with an index of 138, a +0.6% month-over-month increase from November and a +2.6% year-over-year increase compared to December 2022.
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Insights
The introduction of the Fiserv Small Business Index represents a significant development for stakeholders interested in the health of the U.S. small business sector. The Index's reliance on transactional sales data, rather than surveys or sentiment, provides a more objective and timely measure of consumer spending. This data can be particularly valuable for investors and analysts seeking to understand the performance of small businesses, which are often less visible in economic reporting than larger corporations.
By benchmarking to 2019, the Index offers a reference point that accounts for pre-pandemic economic conditions, allowing for a clearer analysis of growth or contraction in the sector. The granularity of the data, covering 16 sectors and 34 sub-sectors, enables users to pinpoint trends and performance variations with a high degree of specificity. This could influence investment decisions, particularly for those looking at sector-specific funds or small-cap stocks that may be impacted by these trends.
For policymakers, the Index provides a near-real-time gauge of economic health at the grassroots level, which can inform decisions on fiscal policy or targeted support for small businesses. In the broader context, sustained growth in small business spending can signal consumer confidence and a robust domestic economy, which can, in turn, influence stock market sentiment and sector-specific performance.
The Fiserv Small Business Index is a noteworthy addition to the economic indicators available to economists. Small businesses account for a substantial portion of the U.S. GDP and employment, making the Index a critical barometer for the broader economy. The Index's monthly publication schedule allows for a more agile response to emerging trends than quarterly or annual reports.
December's reported upswing in consumer spending, particularly in food services, retail and healthcare, suggests a resilient consumer base despite any underlying economic uncertainties. The reported year-over-year increase in spending indicates a positive trajectory for small businesses, which could contribute to overall economic growth.
However, it's important to consider the variability of small business performance across different regions and sectors. While the Index provides an aggregate view, localized economic factors and industry-specific challenges can cause divergent trends. Economists would need to analyze the Index in conjunction with other economic data to get a comprehensive picture of the U.S. economy.
From a financial analysis perspective, the Fiserv Small Business Index offers actionable intelligence that can be leveraged for portfolio management. The Index's detailed breakdown by NAICS categories allows for targeted analysis of consumer spending patterns, which can be correlated with the performance of publicly traded companies that supply goods and services to these small businesses.
The Index's indication of a modest upswing in small business spending at the end of the year could be interpreted as a positive signal for the economy, potentially leading to upward revisions in earnings estimates for related sectors. However, it's important to remain cautious, as small business spending is just one of many factors that influence the stock market.
Financial analysts would benefit from incorporating the Index into their broader market analysis, using it to identify potential growth opportunities or risks within their investment universe. For instance, a consistent increase in spending at restaurants could signal opportunities in food distribution companies, while a decline might prompt a reassessment of risk in those same sectors.
Fiserv Small Business Index aggregates consumer spending activity across millions of
Index will publish during the first week of each month, providing timely insight into the prior month’s activity
Fiserv Small Business Index - December 2023 (Graphic: Business Wire)
The Fiserv Small Business Index will be published during the first week of every month, delivering deeper insights more rapidly than existing measurements and empowering users to respond to emerging trends.
The index is differentiated by its direct aggregation of consumer spending activity within the
“Small businesses are the backbone of our economy, generating
Each month, the Fiserv Small Business Index will provide information and analysis to help business owners, lenders, policymakers, economists, analysts and investors quickly understand the trajectory of certain sectors within the small business ecosystem, benchmark sales performance, make well-informed decisions, and adapt to an ever-changing market.
Benchmarked to 2019, the Fiserv Small Business Index provides a numeric value measuring consumer spending, with an accompanying transaction index measuring customer traffic. Through a simple interface, users can access data by region, state, and/or across business types categorized by the North American Industry Classification System (NAICS). Computing a monthly index for 16 sectors and 34 sub-sectors, the Fiserv Small Business Index is positioned to become a standard reference point for the state of small business, providing a timely, reliable and consistent measure of small business performance even in industries where large businesses dominate.
Fiserv Small Business Index: December 2023
According to the December 2023 Fiserv Small Business Index, spending at small businesses ended the year with a modest upswing. Spending advanced one point in December 2023 with an index of 138, a +
“Small business sales gains in December reflected consumers’ priorities as the end of the year approached – food and drink, retail and healthcare,” said Prasanna Dhore, Chief Data Officer at Fiserv. “The biggest increases in small business spending came from restaurants, clothing and related accessories, and ambulatory healthcare services.”
Food Services and Drinking Places had a very strong December with a six-point gain over November, up to 128, with sales growing +
Nationally, the Fiserv Small Business Index for Retail in December 2023 was 142, unchanged from November. Sales across the Retail sector declined marginally month over month, down -
Accessing the Fiserv Small Business Index
To access the Fiserv Small Business Index visit fiserv.com and click on “Fiserv Small Business Index” or visit fiserv.com/FiservSmallBusinessIndex.
About Fiserv
Fiserv, Inc. (NYSE: FI), a Fortune 500 company, aspires to move money and information in a way that moves the world. As a global leader in payments and financial technology, the company helps clients achieve best-in-class results through a commitment to innovation and excellence in areas including account processing and digital banking solutions; card issuer processing and network services; payments; e-commerce; merchant acquiring and processing; and the Clover® cloud-based point-of-sale and business management platform. Fiserv is a member of the S&P 500® Index and one of Fortune® World’s Most Admired Companies™. Visit fiserv.com and follow on social media for more information and the latest company news.
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Media Relations:
Chase Wallace
Director, Communications
Fiserv, Inc.
+1 470-481-2555
chase.wallace@fiserv.com
Additional Contact:
Ann S. Cave
Vice President, External Communications
Fiserv, Inc.
+1 678-325-9435
ann.cave@fiserv.com
Source: Fiserv, Inc.
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