Small Business Optimism Shows Political Climate As Negative Factor

from the National Federation of Independent Business

The Index of Small Business Optimism declined two-tenths of a point in August to 94.4, with owners refusing to expand; expecting worse business conditions; and unable to fill open positions.

Market expectations (from Bloomberg / Econoday) was a reading between 94.0 to 96.0 (concensus 94.8).

At 94.4, the Index remains well below the 42-year average of 98. Five of the 10 Index components posted a gain, four declined, and one remained unchanged. The outlook for business conditions in the next six months had the most dramatic change, dropping seven points. Setting an all-time high for the survey, 38 percent of business owners cited the political climate as a reason not to expand. Uncertainty about the economy and government policy also hit record highs among small business owners.

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NFIB chief economist Bill Dunkelberg states:

Once again, the NFIB survey showed no signs of strength in the small business sector. Uncertainty seems to be the major enemy of economic progress and the political climate is a major contributor to the high levels of uncertainty that we’ve seen. The current economic environment is not a good one for strong or sustained growth.