The NFIB Small Business Optimism Index fell to 104.9, 2.7 points below November’s reading. November’s report was the second highest reading in the 44-year history of the index. Two of the ten index components rose in December, while five declined. Twenty-seven percent of business owners surveyed said the next three months was a good time to expand, unchanged from last month’s reading.
Reported job creation jumped seven points, as 59% of businesses reported hiring or trying to hire. However, 54% reported few or no qualified applicants for the positions they were trying to fill. Nineteen percent of employers surveyed cited the difficulty of finding qualified workers as their top business problem. A seasonally adjusted net 20% of owners plan to create new jobs, down four points from last month’s record high reading.
Seasonally adjusted, the net percent of owners expecting better business conditions decreased eleven point to 37%. The percent of owners reporting higher sales in the past three months compared to the prior three months was a net 9%, a fourteen point improvement from November. Seasonally adjusted, the net percent of owners expecting higher real sales volumes fell six points, falling to 28% of owners. Capital spending grew two points as 61% of owners reported capital outlays. The percent of owners planning capital outlays in the next 3 to 6 months grew one point to 27%.
Credit concerns remained historically low, as just 3% of owners reported that all their borrowing needs were not met, one point lower than November. Only 1% of business owners surveyed reported that financing was their top business problem, compared to 21% citing taxes.
Read the NFIB report.