Jan 10 (Reuters) – U.S. small business confidence plunged to a six-month low in December, with inflation and labor shortages remaining major problems for business owners, according to a survey on Tuesday. was also shown.
The National Federation of Independent Business (NFIB) saw its Small Business Optimism Index drop 2.1 points last month to 89.8, its lowest level since June.
It was the 12th consecutive month that the index was below its 49-year average of 98. The net share of owners expecting a better business environment over the next six months fell from -43% in November to -51% last month. Most recently, it was -61% until June.
Thirty-two percent of owners reported inflation as the single most important issue, unchanged from November and 5 below July’s figure, the highest since the fourth quarter of 1979. points are low. On the net, about 43% of owners reported raising their average sales. The price has fallen eight points since November to its lowest since May 2021.
Consumer prices will remain unchanged in December and inflation will see the slowest annual rise since October 2021, according to government data to be released on Thursday, according to a Reuters poll of economists. expected to be shown to be highly probable.
Price pressures were showing signs of easing as 2022 drew to a close, but Fed officials still indicated they believed a slowdown in inflation was close enough to stop rate hikes in the near term. not
The Fed has hiked rates most aggressively since the 1980s, raising it from near zero last March to a range of 4.5% last month from 4.25%. The central bank is expected to raise by a quarter of a percentage point from 31 January to when he will meet on 31 February. 1, We aim to exceed 5% before considering a suspension.
A tight labor market remains a concern for the Fed and small businesses.
41% of owners reported job vacancies that were difficult to fill, down 3 percentage points from November. According to the NFIB, the difficulty of filling vacant positions was most acute in the transportation, manufacturing and construction industries.
“Overall, small business owners aren’t optimistic about 2023,” said William Dunkelberg, chief economist at the NFIB. We are in control and are continuing to make business and operational changes to compensate.”
Reported by Dan Burns.Edited by Andrea Ricci
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