Small Business Optimism Inched Up to 98.9 in December
Washington, DC, January 11, 2022--The NFIB Small Business Optimism Index increased slightly in December to 98.9, up 0.5 points from November.
Twenty-two percent of small business owners reported that inflation was their single most important problem encountered in operating their business. Price raising activities has reached levels not seen since the early 1980’s when prices were rising at double digit rates.
“Small businesses unfortunately saw a disappointing December jobs report, with staffing issues continuing to impact their ability to be fully productive,” said NFIB chief economist Bill Dunkelberg. “Inflation is at the highest level since the 1980’s and is having an overwhelming impact on owners’ ability to manage their businesses.”
Key findings include:
* Twenty-two percent report inflation as the single most important problem operating their business, a 20-point increase from the beginning of 2021 and the highest level since Q4 1981.
* Owners expecting better business conditions over the next six months increased three points to a net negative 35%. Owners remain pessimistic about future economic conditions as this indicator has declined 23 points over the past six months.
* Forty-nine percent of owners reported job openings that could not be filled, an increase of one point from November.
According to NFIB’s monthly jobs report, a net 48% (seasonally adjusted) of owners reported raising compensation, up four points from November and a 48-year record high reading. A net 32% plan to raise compensation in the next three months. Thirteen percent cited labor costs as their top business problem, up three points and a 48-year record high reading and 25% said that labor quality was their top business problem.