--NFIB small-business optimism index falls steep three points to
91.4 in June
--Reading is lowest since October
--Hiring conditions worsen
Small-business owner confidence dropped significantly in June,
as sales expectations continued to drop, according to data released
Tuesday.
The National Federation of Independent Business's small-business
optimism index fell 3 points to 91.4 last month. The June reading
was the lowest since October.
The NFIB said the three-point drop was a "substantial decline,"
and the index level is "surely an indication of slow growth."
The report noted the survey was completed before the Supreme
Court decision on the health-care law and the federal
transportation bill. Impacts from either will show up in the July
survey, said the NFIB, which had been a plaintiff in the
health-care case.
The downward slide in sentiment among small business echoes
other data that suggest economic activity stumbled in June. "The
economy definitely slowed mid-year," the report said. And while the
NFIB doesn't expect a recession, growth will be slower than earlier
in 2012.
Small-business owners are worried about future sales and
earnings. The subindex of expected business conditions in the next
six months dropped a large eight percentage points to -10% last
month, and the expected higher real sales subindex declined fell
five points to 3%.
The net earnings trend subindex weakened seven points to -22% in
June.
Hiring conditions deteriorated. The June new-jobs subindex
declined three points to 3%. The NFIB said the net change in
employment per firm over the past three months was -.11, the first
negative reading since December.
Price pressures among small businesses remain muted. Seasonally
adjusted, the net% raising selling prices remained at 3% in
June.
Write to Kathleen Madigan at kathleen.madigan@dowjones.com