WASHINGTON: US small-business confidence rebounded in November, according to a survey on Tuesday, which also showed that inflation and worker shortages remained major issues for owners.
The National Federation of Independent Business (NFIB) said its Small Business Optimism Index rose 0.6 point to 91.9 last month amid an improvement in the share of owners who expected better business conditions over the next six months.
Still, it was the 11th straight month that the index was below the 49-year average of 98. The share of owners expecting better business conditions over the next six months increased three points to -43%. It was -61% as recently as June.
Thirty-two percent of owners reported that inflation was their single most important problem, down a point from October and 5 points lower than July’s reading, which was the highest since the fourth quarter of 1979. About 51% of owners reported raising average selling prices, up a point from October.
Despite persistent worries about inflation, there are signs that price pressures are gradually abating as the Federal Reserve’s aggressive interest rate increases dampen demand and fractured supply chains mend.
Government data on Tuesday is expected to show consumer prices rose moderately in November, with the annual increase in inflation likely the smallest in nearly a year, according to a Reuters survey of economists.
The Fed is expected to start scaling back the pace of rate hikes at the close of its two-day policy meeting on Wednesday. But with the labor market still tight and boosting wages, the US central bank is seen continuing to raise rates for a while.
Forty-four percent of owners reported job openings that were hard to fill, down 2 points from October. The difficulty in filling open positions was most acute in the transportation, wholesale and construction industries, the NFIB said.
“This is one of the more serious supply chain problems and it is not improving,” said William Dunkelberg, NFIB chief economist. “The economy appears to be slowing, but it has not shown up in the demand for labor.”
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