A monthly measure of confidence among small business owners has slipped on less upbeat expectations for the economy as well as sales and hiring.
The National Federation of Independent Business reported that its Small Business Optimism Index fell nine-tenths of a point to 103.6 in June.
“The index remains at a historically high level, but within the index there are signs of trouble that should be a concern. Fewer business owners expect business conditions to improve and fewer expect sales to improve,” said Bill Dunkelberg, chief economist of the NFIB.
The NFIB bases the index on the results of monthly surveys of members of the small business advocacy group, most of them small business owners. For June, five of 10 components of the index retreated, while four advanced and one remained unchanged.
“The data is a mixed bag, and the overall index remains strong by historical standards,” Dunkelberg added. “But there are signs that small business owners are less confident in the near term. That could be problematic if it continues.”
The proportion of small business owners responding to the survey upon which the June index was based who expect the economy to improve fell six points to a net 33 percent.
A net 30 percent of owners reported plans for capital outlays over the next three months, up two points. But the share of owners who said they consider now a good time to expand fell two points to a net 21 percent.
A net 17 percent of owners said they expect higher sales, down five points. At a net negative 10 percent, more owners reported lower earnings than higher earnings.
A net 15 percent of owners reported plans to increase staffing, down three points. A net 30 percent of owners still reported hard-to-fill job openings, although that share fell four points.
A net 4 percent of owners reported plans to increase inventories, up three points. At a net negative 3 percent, more owners said current inventories were too high rather than too low.