Uncertainty “has cast a cloud over the future,” according to the September National Federation of Independent Business (NFIB) Small Business Optimism Index. The index dipped 0.1 points to a recession-level 92.8.
Since the NFIB began its monthly surveys in 1986, the index has been below 93 points a total of 56 times; 32 of which have occurred since the recovery began in June 2009, the report stated.
The September index was pulled down by a “deterioration in labor market indicators,” including declined outlooks in job creation plans, job openings, and employment. The election is just weeks away and essentially a horse-race,” said NFIB chief economist William Dinkelman in a statement. “Everyone is waiting to see what happens, especially small business owners who have a lot at stake in the outcome…Small-business owners are reporting that the political climate is a reason not to expand—second only to the economy. And so, in the meantime, owners are in maintenance mode; spending only where necessary and not hiring, expanding or ordering more inventories until the future becomes more ‘certain.’”
Among the index’s labor market indicators, job creation plans dropped six points. Ten percent of the 691 randomly surveyed NFIB-member small businesses plan to increase employment, down three points, while 11 percent plan reductions, up two points. Hiring, the report stated, is essentially keeping up with population growth.
It wasn’t all gloom and doom. Those who stated it is “a good time to expand” gained three points, while the number of owners expecting business conditions to improve in six months gained four points.
What are small business owners’ top five concerns? According to a recently released NFIB Problems and Priorities survey, the rising cost of health care insurance tops the list of most important problems, followed by uncertainty over economic conditions, energy costs, uncertainty over government actions and unreasonable government regulations.
There are more than 27 million small businesses in the United States and they account for up to 80 percent of all new jobs, according to the Small Business Administration.
Donald Liebenson writes news and features for Millionaire Corner. He has been published in the Chicago Tribune, The Chicago Sun-Times, The Los Angeles Times, Fiscal Times, Entertainment Weekly, Huffington Post, and other outlets. He has also served as a marketing writer for Chicago-based Questar Entertainment and distributor Baker & Taylor.
A graduate of the University of Southern California, he is married with a college-age son. He also writes extensively about entertainment.