After two consecutive months of increases (April and May), small business owner confidence dropped in June according to the National Federation of Independent Businesses. The latest Small Business Optimism Index shows a continued see-saw trend that remains mired between the depths of the recession in 2009 and the heights of the economic expansion of 2004-2005.
According to NFIB and the report’s authors, the largest factor was consumer spending, in particular spending on services, which account for about 70 percent of consumer spending.
“Nothing cheers up a small-business owner more than a customer, and they remain scarce and cautious while consumer spending remains weak and more owners are reporting negative sales trends than positive ones,” said William Dunkelberg, NFIB’s chief economist. “Until growth returns to the small-business half of the economy, it will be hard to generate meaningful economic growth and job creation.”
Job creation from small businesses remained mostly flat for June. While 360,000 new part-time jobs were added, about 240,000 full-time jobs disappeared.
The largest challenges cited by respondents were taxes, government regulations and poor sales.
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