San Francisco, CA (PRWEB) December 21, 2012
The National Federation of Independent Business (NFIB) Small Business Optimism Index was recently released showing a plunge of 5.6 points to 87.5, one of the lowest readings in the history of the survey. This dismal result underscores the pessimism and lack of confidence in an improving economy in the United States any time soon.
November saw two events that could have precipitated such a drop; the Presidential elections, and Hurricane Sandy. To determine the primary cause for the drop, researchers removed those states impacted by Hurricane Sandy from the results. The modified data showed clearly that the drop in small business owner optimism was a result of the Presidential elections.
Something bad happened in Novemberand based on the NFIB survey data, it wasnt merely Hurricane Sandy. The storm had a significant impact on the economy, no doubt, but it is very clear that a stunning number of owners who expect worse business conditions in six months had far more to do with the decline in small-business confidence, said NFIB chief economist Bill Dunkelberg. Nearly half of owners are now certain that things will be worse next year than they are now. Washington does not have the needs of small business in mind. Between the looming fiscal cliff, the promise of higher health-care costs and the endless onslaught of new regulations, owners have found themselves in a state of pessimism. We are forced to ask: is this the new normal?
Terry Robinson, President of Sunovis Financial, concurs with the findings in his own sampling. “The small business owners we talk to are concerned over no access to credit, over the fiscal cliff and inability for Congress to work together, and they are worried about new regulations, taxes and costs. Small business is the engine of growth for the U.S. economy, so this does not bode well.”
The most stunning reading in the index was expectations for future business conditions. The number of small business owners expecting better business conditions in 6 months dropped a staggering 37 points to end up at a net 35 point negative reading. Forty nine percent of those surveyed now expect business conditions to be worse in 6 months than they are now and an additional 11 percent are uncertain about the future.
The monthly Index survey has been taken by the NFIB since 1986 and since that time, only 7 monthly readings were lower. Of these, 6 came during the end of 2008 and the beginning of 2009 while the country was in the depths of the Great Recession. When the survey was conducted on a quarterly basis prior to 1986, only two readings were lower than this months, the 1975Q1 and 1980Q2 readings.
About Sunovis Financial
Every small business is important to local communities and even more important in rebuilding the American economy. Today more than ever, small businesses need capital and assistance to thrive, and that is what Sunovis is focused on. Sunovis is an SBA expert, and also offers Short-Term Micro Loans for small businesses, not weighted on FICO scores or collateral but on business health and cash flow.
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