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Index Shows Small-Business Optimism Continues to Plummet

WASHINGTON — Small-business owners’ optimism continued its downward trend in December, keeping the sour note that held steady for most of 2009, according to the National Federation of Independent Business (NFIB).In December, NFIB’s Small Business Optimism Index decreased 0.3 point to 88 from November. The index has been below 90 for 15 straight months, reflecting the difficulty of the year overall. The index’s lowest reading was 80.1 in 1980.The subindex that covers sales expectations increased 1 percentage point in December, but was still at -1%. The index for better earnings remained at -43%, and the capital outlays index rose 2 points to 18%. The job-creation index rose 1 point to -2%.The NFIB report also indicated that the weak economy was putting downward pressure on prices, with just 10% of small-business owners reporting raising average prices and 33% reporting price reductions in December. 

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