US small business confidence dips in June
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The news: The National Federation of Independent Business (NFIB) said on Tuesday that US small business confidence slipped in June, as businesses reported excess inventories and declining sales optimism weighs on the economy.
The numbers: The NFIB Business Optimism Index edged down two tenths of a point in June to 98.6, while the NFIB’s Uncertainty Index decreased by five points from May to 89.
12% of surveyed businesses reported current inventories “too high” in June compared to 7% in May. This component contributed the most to the Optimism Index’s decline.
19% of small business owners reported taxes as their single most important concern, up one point from May and ranking as the top problem again. The last time taxes reached 19% was in July 2021.
The context: “Small business optimism remained steady in June while uncertainty fell,” said NFIB chief economist Bill Dunkelberg. “Taxes remain the top issue on Main Street, but many others are still concerned about labor quality and high labor costs.”
The uncertainty index drop was the survey’s lowest reading this year, as US President Donald Trump’s trade and spending policies continue to add instability to the market. The report reads: “Sentiment is in the tank, consumers are sharply divided on their political affiliation. Democrats are depressed, Republicans jubilant. Just how this will shape their spending is less clear. As uncertainty is resolved, the outlook will become clearer.”
The sources: NFIB report, Reuters
