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Optimism for small businesses unexpectedly collapsed in December



As owners are increasingly concerned about the new economic policies of the incoming Biden administration, and the spread of coronavirus infection has triggered new restrictions, the optimism of US small businesses unexpectedly fell to a seven-month low in December.

The National Federation of Independent Business said on Tuesday that its sentiment index fell 5.5 points to 95.9.

The result is a sharp drop from 101.4 last month, and is weaker than the forecast of the 102 median of the economists surveyed by The Economist.

NFIB chief economist Bill Dunkelberg (Bill Dunkelberg) said: “This month̵

7;s small business optimism is a very large decline in history, most of the decline is due to 2021 sales prospects and business conditions.”

Nine of the 10 index components have fallen, and only one (ie current inventory) has improved. Owners who expect their business conditions to improve in the next six months dropped sharply, down 24 points to a net negative 16%.

The proportion of owners who think it is a good time to expand dropped by 4 percentage points to 8%. Sales expectations for the next three months fell by 14 points to a net negative 4%. The plan to increase employment dropped by 4 percentage points to 22%.

Dunkelberg said: “Small businesses are worried about the potential new economic policies in the new government and the spread of COVID-19 is causing the government to force new business closures across the country.”


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