Small business confidence in the U.S. fell slightly last month after a post-election surge, according to a survey released this week by the National Federation of Independent Business (NFIB). Although the majority of small-business owners were looking to hire, 45% reported that there were few or no qualified applicants to fill open positions. The group’s Small Business Optimism Index decreased 0.6 to 104.7 in March, still a high reading overall.
NFIB’s March survey was conducted before Congress decided not to repeal Obamacare, which could lower business optimism in the not-too-distant future, said NFIB’s President and CEO Juanita Duggan. Yet Bill Dunkelberg, NFIB’s chief economist, sounded a more positive note. “Consumer confidence is hitting new high levels and small-business owners have not given up hope that their optimism will be rewarded with performance,” he said.
Three of the 10 components tracked in the index rose by a single point in March: small-business owners’ actual earnings, capital spending and plans to increase employment. Sales expectations dropped by eight points. Two components decreased by a point, including owners’ plans to increase inventories. When citing their single most important business problem, 16% of small-business owners said finding qualified workers.
The uncertainty index rose to 93 in March, its second-highest reading on record. “More small-business owners are having a difficult time anticipating the factors that affect their businesses, especially government policy,” said Dunkelberg.
While NFIB’s index slipped, in the promo products industry, the Counselor Confidence Index currently sits near a record high, as distributors maintained continued optimism throughout 2016.