09 April 2013 19:02 [Source: ICIS news]
WASHINGTON (ICIS)--US small business owners are losing confidence in the nation’s recovery, according to survey results issued on Tuesday, with no plans for expansion or hiring among small firms that typically generate most new jobs in the US.
In its monthly survey, the National Federation of Independent Business (NFIB) said that its index of small business optimism fell by 1.3 points in March from February and ended a modest, three-month gain.
The index stands at 89.5, said the federation, putting the March reading below the average level of 90.7 seen over the 44 months since the Great Recession ended in June 2009.
“Small business confidence has sputtered and stalled again,” said NFIB chief economist Bill Dunkelberg, referring to first-quarter slowdowns that have haunted the recovery each year since the recession ended.
“For the sector that produces half the private GDP and employs half the private sector workforce – the fact that they are not growing, not hiring, not borrowing and not expanding like they should be is evidence enough that uncertainty is slowing the economy,” Dunkelberg said.
“Virtually no owners think the current period is a good time to expand, because they simply don’t know what the future holds,” he said. “So why invest?”
“Overall, it appears that there will be little growth coming from the small business half of the economy,” Dunkelberg said.
US small businesses – those with 500 or fewer employees – typically generate 64% of all new US jobs, according to the Labor Department.
NFIB said that the net percent of owners expecting better business conditions in six months was a net negative 28%.
“These readings are among the lowest in the 40-year history of the NFIB survey,” Dunkelberg said.
He cautioned that as expansion and hiring stagnate among the nation’s 28m small businesses, the slowdown ultimately could begin to afflict larger firms.
Paul Hodges studies key influencers shaping the chemical industry in Chemicals and the Economy
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