What’s driving the US small business sector?

D&B Small Business Health Index

The small business sector maintained its pre-recession

strength in March 2013 despite a slight drop in D&B’s

monthly Small Business Health Index. Nearly all major

sectors declined, with the exception of real estate and

business services. The automotive and transportation

sectors suffered significant declines in March compared

to February. In contrast, robust improvement in the

real estate sector (following strong construction

performance in February) signals a fast-healing housing

industry. The continued rise in pending home sales

confirms this trend and suggests housing could be a

key growth driver for small businesses in 2013.

More small businesses in nearly all sectors closed

their doors in March, indicating pre-recession

durability remains a remote objective for many.

Small businesses on the whole continued to pay their

bills on time for the third straight month, with only

slight declines in the manufacturing, construction,

and automotive sectors.

May 2013

March 2013

Small Business Health Index: Overall

Source: D&B Global Data, Insights & Analytics

0

20

40

60

80

100

120

Mar 13Dec 10Dec 08Dec 06Dec 04

March

0.79points

Credit Card Delinquency

Small Business Failures

140

145

150

155

160

Mar 2013Feb 2013Jan 2013Dec 2012

Payment Delinquency

Credit Card Utilization

80

95

110

125

140

Mar 2013Feb 2013Jan 2013Dec 2012

77

78

79

80

81

Mar 2013Feb 2013Jan 2013Dec 201242

44

46

48

50

Mar 2013Feb 2013Jan 2013Dec 2012

Credit Card Delinquency

Small Business Failures

140

145

150

155

160

Mar 2013Feb 2013Jan 2013Dec 2012

Payment Delinquency

Credit Card Utilization

80

95

110

125

140

Mar 2013Feb 2013Jan 2013Dec 2012

77

78

79

80

81

Mar 2013Feb 2013Jan 2013Dec 201242

44

46

48

50

Mar 2013Feb 2013Jan 2013Dec 2012

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May 2013

Fewer small businesses struggled with delinquent

credit card balances in March, a bright spot in the

overall Index after struggling through much of 2012.

While the overall Index tracks with pre-recession performance, small businesses continue to struggle in key areas. A drop in the credit card utilization subcomponent, typically a bellwether for larger Index performance, is cause for concern. Nevertheless, a rise in the credit card delinquency subcomponent hints that small businesses are steering their fiscal ships in the right direction. A few more months may reveal whether the small business sector is truly headed toward complete recovery.

D&B’s monthly Small Business Health Index (SBHI) measures small business health through payment patterns, failure rates, and credit utilization. The SBHI follows a sampling of all active small businesses with fewer than 100 employees

and combines pro- and counter-cyclical elements to provide a simple, representative number. Using 2004 as the base year (Index value 100), improvement is designated by an Index value above 100.

More small businesses depended on credit cards

in March, evidencing shrinking access to traditional

forms of credit.

Credit Card Delinquency

Small Business Failures

140

145

150

155

160

Mar 2013Feb 2013Jan 2013Dec 2012

Payment Delinquency

Credit Card Utilization

80

95

110

125

140

Mar 2013Feb 2013Jan 2013Dec 2012

77

78

79

80

81

Mar 2013Feb 2013Jan 2013Dec 201242

44

46

48

50

Mar 2013Feb 2013Jan 2013Dec 2012

Credit Card Delinquency

Small Business Failures

140

145

150

155

160

Mar 2013Feb 2013Jan 2013Dec 2012

Payment Delinquency

Credit Card Utilization

80

95

110

125

140

Mar 2013Feb 2013Jan 2013Dec 2012

77

78

79

80

81

Mar 2013Feb 2013Jan 2013Dec 201242

44

46

48

50

Mar 2013Feb 2013Jan 2013Dec 2012

What is the Small Business Health Index?

© Dun & Bradstreet, Inc. 2013. All rights reserved. (DB-3515 5/13)

D&B’s informed perspective puts the future in focus, helping you protect, grow, and empower your business. To learn more, visit www.dnb.com

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