The owners of small businesses throughout the U.S. were less optimistic about business and economic conditions in June, according to the latest Index of Small Business Optimism from the National Federation of Independent Business (NFIB).
The June index was 89.0, down 3.2 points from its May reading. The Index has been below 93 in all of the 30 months since January 2008. It has been below 90 in 23 of those months, the NFIB news release states.
Most of the June decline, "resulted from deterioration in the outlook for business conditions and expected real sales gains. Owners have no confidence that economic policies will fix the economy," says NFIB.
"The U.S. economy faces hurricane force headwinds and the government is at the center of the storm, making an economic recovery very difficult," said William Dunkelberg, NFIB chief economist.
The Index is the result of a monthly survey of small business owners. There were 805 respondents to the June survey. The NFIB is a non-profit, non-partisan organization that represents small and independent businesses.
Highlights of the survey include:
EmploymentJob growth was down slightly, continuing the negative trends that started in April 2007.
Capital spendingPlans for capital spending fell one point in June. A net negative 6% of respondents expect business conditions to improve in the next six months, down 14 points from May.
Sales and inventoryThe net percent of owners reporting higher nominal sales in the past three months fell four points in June to a net negative 15%. This was significantly better than June 2009, however far more firms continue to report quarter-over-quarter sales declines than firms reporting positive sales growth.
InflationPrices continue to decline. June was the 19th consecutive month in which more owners reported cutting selling prices than raising them.
EarningsA net negative 32% of respondents reported positive profit trends. This is three points worse than in May and 28 points worse than the best expansion reading reached in 2005.
CreditA net 13% of business owners surveyed reported loans harder to get than their last attempt, which was unchanged from May.