© Reuters. FILE PHOTO: A worker repairs a bicycle in the Toga Bike Shop in Manhattan, New York City, U.S., June 28, 2022. REUTERS/Andrew Kelly/File Photo
By Amina Niasse
NEW YORK (Reuters) – U.S. small business sentiment edged down in November to the lowest level in six months, stoked by continued difficulties in hiring skilled labor and concerns about inflation.
The National Federation of Independent Business (NFIB) said its small business optimism index fell to 90.6 last month from 90.7 in October. The index remained below its 50-year average of 98 for a 23rd straight month.
Optimism has fallen since peaking this year in July as businesses report difficulties finding labor and battling inflation. A net negative 32% of businesses reported higher profits in November, unchanged from October.
While difficulties filling open positions persist, the percentage of businesses describing few or no qualified job applicants fell to 50%, the lowest since January 2021. The fall brings it below the average of about 52 in the two years before the coronavirus pandemic.
Fewer owners also reported difficulty filling open positions, with the figure falling three points from October to 40%, though the current pace of hiring remains weak.
“The net percent of NFIB firms increasing employment has been negative since March, with more firms decreasing jobs than adding them,” the report said. “Openings remain elevated, but the surge in the economy did not bring a strong wave of workers to fill open positions.”
As the Federal Reserve nears the close of its interest rate hiking cycle, 25% of owners surveyed paid a higher rate on their most recent loan, down three points from October. The outlook on business conditions has also been impacted by widespread economic uncertainty, according to the report.
The portion of owners expecting better business conditions on a six-month basis rose one point to a net negative 42% in November.
