(Bloomberg) -- Blame Corporate America for a reluctance to invest. Small businesses aren't holding back.
Capital expenditures by non-financial, non-corporate U.S. businesses -- typically smaller firms -- rose to 2.35 percent of gross domestic product in the third quarter, the most since 1989, according to data published Thursday by the Federal Reserve. Meanwhile, larger companies are only investing to the tune of 9.15 percent of GDP -- well below levels that prevailed in the previous two expansions, and even earlier in this expansion.
The step-up in investment may indicate that small businesses are responding to mounting labor costs, which may foreshadow a long-awaited pickup in productivity growth, said Carl Riccadonna, chief U.S. economist at Bloomberg Intelligence.
To contact the reporter on this story: Matthew Boesler in New York at mboesler1@bloomberg.net.
To contact the editors responsible for this story: Brendan Murray at brmurray@bloomberg.net, Scott Lanman
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