Small business sentiment in the United States fell slightly in September due to continued concerns about inflation and persistent job shortages, according to a survey published on Tuesday.
The Small Business Optimism Index fell half a point last month to 90.8, according to the National Federation of Independent Business (NFIB). The index in September was also below the 49-year average of 98 points for the 21st month in a row.
The September report was similar to the report for August, which saw the first drop in optimism since April with businesses citing a tight labor market and inflation as key concerns.
"Business owners remain pessimistic about business conditions, which has contributed to low optimism about the economy," said Bill Dunkelberg, NFIB chief economist. "Sales growth among small businesses has slowed and bottom lines have been poor, leaving business owners with little choice but to raise selling prices."
In the face of the Federal Reserve's most aggressive rate hike campaign in decades, small businesses face higher borrowing costs. Widespread economic uncertainty has also increased fears of a future recession and this is putting pressure on business prospects.
The number of owners who expect better business conditions in the next six months fell six points to a net negative 43%. The share of owners citing inflation as their main concern remained unchanged at a seasonally adjusted 23%.
Businesses in the construction, retail, manufacturing, and service industries most often report job shortages as a pressing concern. Ninety-three percent of businesses that are active in the hiring market say they are not getting enough qualified workers for their positions.
