Small Business Confidence Nearly Flat for December

Small business owner
Ryan McVay | Photodisc | Getty Images

Small-business owners' confidence was virtually flat in December, as entrepreneurs still expect business conditions to worsen in the next six months.

That's the finding of a survey by the National Federation of Independent Business. The group said Tuesday that its small-business optimism index crept up 0.5 point to 88 points in December 2012 from 87.5 points in November. The December reading is the second lowest since March 2010. (Read more: November Small-Business Sentiment Nearly Flat)

While a fiscal deal was reached earlier this month on tax increases and spending cuts, benefits remain elusive for much of Main Street.

"The eleventh hour 'deal' has brought marginal certainty about tax rates and extenders and will provide some relief to owners, but it certainly doesn't guarantee a more positive forecast for the economy," NFIB Chief Economist William Dunkelberg said in a prepared statement. (Read More: Amid 'Fiscal Cliff' Stalemate, Main Street Deteriorates)

While a deal was signed this month to avert a so-called "fiscal cliff," issues such as the nation's long-term debt remain unresolved. Some small-business owners have been saying for some time that uncertainty about federal policies has prompted them to hold back on capital investment and job creation on Main Street — traditional engines of economic growth. (Read more: After Fiscal Deal, Small Companies Push for ManufacturingGrowth)

Small-business sales showed some improvement in December, according to the survey. Job creation was essentially zero and capital spending remained in "maintenance" mode.

"The January survey results will be far more enlightening about how the sector views the deal — higher taxes and minimal spending cuts may not be a panacea," Dunkelberg said. (Read more: 2013 Small-Business Trends to Watch)

Written by CNBC's Heesun Wee. Follow her on Twitter @heesunwee