NFIB Survey Shows Stumble in Small Business Optimism

The National Federation of Independent Business’ Index of Small Business Optimism fell to 93.9 in January, marking a 1.3 point drop from the reading in December.

According to the NFIB, more owners reported cutting average prices than raising them even as reports of higher compensation rose to expansion high levels. In addition, more owners reported sales trending down than trending up quarter on quarter and profit trends worsened a bit.

Parallel to the drop in the index, the NFIB noted that consumer sentiment fell to one of the lowest readings in the past 12 months. Additionally, over 40% of consumers reported that the government was doing a poor job, which is twice the total of consumers who believe it is doing a good job.

Among business owners who characterize the current environment as a bad time to expand, one in five cite the political climate as the reason, the second most frequently cited reason after weak sales and a poor economy.

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