Small Business Optimism Index Declines
The National Federation of Independent Businesses released its monthly Small Business Optimism Index, showing business owners lost confidence for the third month in a row.
The month of May had an index reading of 90.9, 0.3 points lower than the previous month. The NFIB says the mark is similar to what was seen in the recession. The drop is in part because of a lack in consumer spending, which damages the service sector.
"Corporate profits may be at a record high, but businesses on Main Street are still scraping by," said NFIB chief economist Bill Dunkelberg. "The icing on the cake: the growing debt, large deficits, threats of higher taxes, regulations being spewed out by state and local administrations, and the uncertainty of the new health care law - is it any wonder that optimism is down?"
Many factors are involved in the continued decline of the index. Inflation has increased, and this has forced a rise in prices. In addition, employment has continued to tumble. Many business owners complain of falling sales as the largest issue for them.
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