Econintersect: The National Federation of Independent Business (NFIB)’s February 2014 monthly optimism index dropped from 94.1 to 91.4.
NFIB reports usually contain blasts directed at Washington by NFIB chief economist Bill Dunkelberg.
Uncertainty is a major cause of the Index’s dip. Lacking any progress in Washington and facing continued unknowns with the healthcare law, the EPA, the minimum wage, tax reform and more, it is no surprise that the Small Business Optimism Index fell, reversing a few months of modest gains.
As long as uncertainty remains high, owners will remain cautious when it comes to increasing inventory. Business owners aren’t going to bet their money on a future they cannot see clearly. The February report on net new jobs was better than expected, but inadequate to the task of reducing the unemployment rate which rose a tenth of a point. As disturbing as the decline in job creation plans was, the plunge in expectations for improvements in real sales in the coming months and for business conditions 6 months from now, show that we shouldn’t expect blue skies soon.
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