Small business confidence has improved for the fourth consecutive month in the United States, according to the National Federation of Independent Business (NFIB) Optimism Index.
For the second consecutive month, small-business optimism rose 1.8 points in December, leaving the reading at 93.8.
“Much of December’s gain resulted from the fact that concerns about business conditions over the next six months have subsided and because many small-business owners have improved their expectations for real sales gains in the coming months,” said NFIB Chief Economist Bill Dunkelberg.
“But make no mistake: the economic winter is still here. Similar gains in the early part of 2011 quickly faded, and the Index is still well below where it should be at this point in the recovery. The economy appears to be slowly recovering, resolving imbalances in debt, housing and the like. But, it is unlikely that growth will be much better than 2011 even with a solid fourth quarter GDP growth. There is still a lot of work to be done.”
While the Index has gained 5.7 points over the last four months with several indicators posting notable gains, the total reading is still in recession territory. The Index is still 6 points below the pre-recession average and more than 10 points below the same point in the recovery from the 2001 recession.
The gains in the Index are supportive of the view that economic growth will pick up in 2012, but nothing dramatic. The level of the Index is consistent with weak growth.
NFIB’s Small Business Economic Trends is a monthly survey of small-business owners’ plans and opinions.
