NFIB: U.S. Small Biz Optimism Slips

Gov't Shutdown Partially To Blame

Small Business OptimismA new survey released by the National Federation of Independent Business (NFIB) shows that U.S. small business optimism fell in October, breaking a string of steady confidence gains throughout 2013. The NFIB’s Small Business Optimism Index dropped to 91.6 in October, down from 93.9 from September, mostly as a result of last month’s partial government shutdown.

"Washington paralysis is never good news for the economy, so it was no surprise that while politicians were arguing over whether or not the government should remain fully operational, small business optimism measures deteriorated," said Bill Dunkelberg, NFIB’s chief economist, in a statement.

Even though the government shutdown is over, NFIB data shows smaller firms still don't expect business conditions to improve in advance of the next federal budget deadline in January. Nearly 70% of small-business owners think now is a bad time to expand operations. Of that 70%, almost 40% say their negativity is due to the political climate.

Separately, data from firm Sageworks shows that, so far in 2013, sales at U.S. businesses with less than $5 million in annual revenues are flat. Meanwhile, recently found that 80% of small businesses don’t plan to hire additional employees for the holiday season. While these overall U.S. numbers demonstrate uncertainty among company owners, businesses within the ad specialty industry remain much more optimistic. In fact, the latest ASI quarterly sales report – released this past Tuesday – showed that 55% of industry distributors expect their 2013 sales to be better than last year’s revenues.