The latest issue of the NFIB Small Business Economic Trends is out today. The update for November came in at 94.8, down 1.3 from the previous month’s 96.1. The index has dropped to the 25th percentile in this series.

Today’s number came in below the Investing.com forecast of an increase to 96.6.

Here is an excerpt from the opening summary of the news release.

“During this holiday season, small business owners are finding little to be hopeful or optimistic about including the economy in the New Year. This month’s Index continues to signal a lackluster economy and shows that the small business sector has no expansion energy whatsoever.” — Bill Dunkelberg, NFIB Chief Economist

The first chart below highlights the 1986 baseline level of 100 and includes some labels to help us visualize that dramatic change in small-business sentiment that accompanied the Great Financial Crisis. Compare, for example the relative resilience of the index during the 2000-2003 collapse of the Tech Bubble with the far weaker readings following the Great Recession that ended in June 2009.

The average monthly change in this indicator is 1.3 points. To smooth out the noise of volatility, here is a 3-month moving average of the Optimism Index along with the monthly values, shown as dots.

Here are some excerpts from the report.

Labor Markets

Fifty-five percent reported hiring or trying to hire (unchanged), but 47 percent reported few or no qualified applicants for the positions they were trying to fill. Sixteen percent reported using temporary workers, up 2 points. Twenty-seven percent of all owners reported job openings they could not fill in the current period, unchanged over the past 2 months. This is a solid reading historically and suggests no significant change in the unemployment rate.

Inflation

How effective has the Fed’s monetary policy been in lifting inflation to it two percent target rate?

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