D&B’s Small Business Health Index declined nearly 2 points in May 2013, revealing continued challenges for the small business sector. The across-the-board decline brought the monthly Index below May 2012 levels, and marked the third consecutive decrease since March 2013.

1. What’s driving the US
small business sector?
DB Small Business Health Index
DB’s Small Business Health Index declined nearly 2 points
in May 2013, revealing continued challenges for the small
business sector.The across-the-board decline brought the
monthly Index below May 2012 levels, and marked the third
consecutive decrease since March 2013. Business services
and retail were among the subsectors driving the decline,
although manufacturing and construction showed resilience.
Despite encouraging increases in jobs and industrial
production, the Index’s overall sluggishness likely results from
other factors, including tepid growth in the nation’s GDP,
consumer spending, and international trade. Ongoing cuts
in government spending arguably continue to block such
growth, and that could mean more choppy economic waters
for small businesses through the rest of 2013.
Small business failures, including bankruptcies and other
closures, persisted for the third consecutive month in May,
although the manufacturing sector bucked that trend.
Small business owners struggled to pay their bills on
time for the second consecutive month in May, indicating
continued setbacks with income growth and cost overruns.
July 2013
March 2013
Small Business Health Index: Overall
Source: DB Global Data, Insights Analytics
0
20
40
60
80
100
120
May 13Dec 10Dec 08Dec 06Dec 04
M
ay
1.6points
Credit Card Delinquency
Small Business Failures
140
145
150
155
160
May 2013Apr 2013Mar 2013Feb 2013
Payment Delinquency
Credit Card Utilization
80
95
110
125
140
May 2013Apr 2013Mar 2013Feb 2013
Credit Card Delinquency
Small Business Failures
140
145
150
155
160
May 2013Apr 2013Mar 2013Feb 2013
Payment Delinquency
Credit Card Utilization
80
95
110
125
140
May 2013Apr 2013Mar 2013Feb 2013
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2. With the exception of the automotive sector, more small
businesses struggled with making credit-card payments
on time in May.
The Small Business Health Index’s discouraging May 2013 performance is counterbalanced
by key bright spots. In particular, steady gains in new residential sales and spending in home
construction could present important growth opportunities to small businesses in those
sectors. Nevertheless, the Index’s choppy performance throughout the first five months of
2013 reflects a larger pattern of uneven economic growth – a pattern that is likely to linger.
DB’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.
Small businesses relied more heavily on credit cards in
May, suggesting a slight reduction in access to traditional
lending sources.
Credit Card Delinquency
140
145
May 2013Apr 2013Mar 2013Feb 2013
Credit Card Utilization
80
95
May 2013Apr 2013Mar 2013Feb 2013
77
78
79
80
81
May 2013Apr 2013Mar 2013Feb 2013
42
44
46
48
50
May 2013Apr 2013Mar 2013Feb 2013
Credit Card Delinquency
140
145
May 2013Apr 2013Mar 2013Feb 2013
Credit Card Utilization
80
95
May 2013Apr 2013Mar 2013Feb 2013
77
78
79
80
81
May 2013Apr 2013Mar 2013Feb 2013
42
44
46
48
50
May 2013Apr 2013Mar 2013Feb 2013
What is the Small Business Health Index?
© Dun Bradstreet, Inc. 2013. All rights reserved. (DB-3550 7/13)
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What can we expect for small business?
July 2013