Small business owners’ economic confidence dropped in June, according to a survey by the National Federation of Independent Business.
The NFIB Index of Small Business Confidence fell 3.2 points in June falling to 89.0 after posting modest gains for several months.
“The U.S. economy faces hurricane force headwinds and the government is at the center of the storm, making an economic recovery very difficult,” William Dunkelberg, NFIB’s chief economist, said Tuesday.
Another survey, released earlier this month found confidence among small business owners leveled off in June after rising the previous two months. This second survey was done by the financial services company Discover.
Discover's index dipped to 86.1 in June from 87.4 in May as rising concerns over temporary cash flow issues offset some improvement in the way small business owners see the climate for their own operations.
The less than rosy outlook was weighed down by too much competition and cash flow problems, analysts said.
Small business owners reporting temporary cash flow issues jumped to 51 percent in June, up from 45 percent in May and the highest since January, according to a statement from Discover.
“Many small business owners are working harder than ever to make payroll , pay their bills and keep their businesses running,” said Ryan Scully, director of Discover’s business credit card. “Last month, more owners reported increasing their spending, which is good news. However, if sales are lagging this month, it’s possible that cash flow was more of an issue.”
In June, 29 percent of small business owners said they believe the overall economy is getting better, down from 35 percent in May.
The gulf oil spill had a negative effect on 30 percent of those surveyed, while the European debt crises was said to affect 40 percent of small businesses.
Meanwhile, the American entrepreneurial spirit trudged on, with 53 percent of small business owners saying they would not take a job for the same or more money.
The Discover Small Business Watch is a monthly index measuring the relative economic confidence of U.S. small business owners who have less than five employees, a segment that consists of 22 million businesses producing more than a trillion dollars in annual receipts. The Watch is based on a national random survey of 750 small business owners.
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