Signs of growing economic optimism, even as U.S. Labor Department reports 7.7 million jobs were lost in April.

A couple of short items suggest that the gradual opening of the economy may be going better than many anticipated, as always, with caveats.

The NFIB Small Business Optimism Index improved in May.

The Small Business Optimism Index increased 3.5 points in May to 94.4, a strong improvement from April’s 90.9 reading. Eight of the 10 Index components improved in May and two declined. The NFIB Uncertainty Index increased seven points to 82. Reports of expected business conditions in the next six months increased 5 points to a net 34%, following a 24-point increase in April. Owners are optimistic about future business conditions and expect the recession to be short-lived.

“As states begin to reopen, small businesses continue to navigate the economic landscape rocked by COVID-19 and new government policies,” said NFIB’s Chief Economist Bill Dunkelberg. “It’s still uncertain when consumers will feel comfortable returning to small businesses and begin spending again, but owners are taking the necessary precautions to reopen safely.”

Employment is still a concern, the survey reveals.

May Survey respondents reduced employment by 0.17 workers per firm in the prior three months, down from an addition of 0.09 workers per firm in the April report. Six percent (down 1 point) reported increasing employment an average of 3.3 workers per firm and 21 percent (up 2 points) reported reducing employment an average of 5.1 workers per firm (seasonally adjusted). May’s survey was bad news for job creation. A seasonally-adjusted net 8 percent plan to create new jobs, up 7 points. Driven in part by the forgiveness eligibility requirements for PPP and small business owners planning to re-hire workers as the economy is reopened and stay-at-home orders end. Twenty-three percent (seasonally adjusted) of all owners reported job openings they could not fill in the current period, down 1 point. Just a few months ago, nearly 40 percent reported openings. Forty-four percent reported hiring or trying to hire in May, down 3 points. Thirtyseven percent (84 percent of those hiring or trying to hire) reported few or no “qualified” applicants for the positions they were trying to fill, down 4 points. 

Economists surveyed by FiveThirtyEight are also a bit more optimistic

The National Bureau of Economic Research announced on Monday that the U.S. is officially in a recession. But while the country’s economy is still in dire straits, economists now think the recovery might be quicker — and less painful — than they were expecting a few weeks ago. Our survey of 34 quantitative macroeconomic economists, conducted in partnership with the Initiative on Global Markets at the University of Chicago Booth School of Business, found that respondents are increasingly optimistic about the country’s economic trajectory — at least when it comes to employment.

That newfound hope is mostly because of the jobs report released last week

But the better-than-expected jobs numbers didn’t convince the economists in our survey that the economy will be back to normal anytime soon. Their forecasts for growth in gross domestic product, for instance, didn’t change much over the past few weeks. Respondents do think the economy will be growing by the end of the year — but nowhere near as quickly as it fell.

The optimism, tempered as it is, contrasts with the employment news. The U.S. Department of Labor reports layoffs fell in April, though remain at a very high level. And there’s very little hiring reported. The Associated Press reports, 

U.S. employers laid-off 7.7 million workers in April — a sign of how deep the economic hole is as offices, restaurants, stores and schools are re-opening after being shuttered because of the coronavirus.

The Labor Department also said in a Tuesday report that job openings plummeted and hiring all but disappeared in April. The number of available jobs fell 16% from March to 5 million. Hires declined 31% to 3.5 million.