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Small-Business Index Slips In November

A gauge of small-business optimism slipped slightly in November as business owners grew more worried on future earnings and fewer reported unfilled job openings, a business lobby group said on Tuesday.

The survey offers Federal Reserve policymakers yet another glimpse of the economic landscape heading into this afternoon's Federal Open Market Committee meeting. The officials are widely expected to keep benchmark borrowing costs at 5.25%, but investors are looking to see what they say about economy when they issue their statement at 2:15 p.m. New York time.

The National Federation of Independent Business said its Index of Small Business Optimism fell one point to 99.7 in November, sticking close to its 30-year average of 100.2.

"Although the decline in job openings accounted for the largest share of the loss, that component remained at historically high levels," the NFIB said in its report.

It said 22% of respondents reported unfilled job openings, down 5 points from the prior month.

NFIB also said the number of businesses expecting to increase inventories and the number expecting higher earnings each fell by 4 points.

But rising optimism on future sales and expectations of greater job creation helped offset that weakness.

"It's a tight labor market," said William Dunkelberg, chief economist at the NFIB on CNBC's "Squawk Box." "More than one in 10 (small businesses surveyed) say that's their number one problem: trying to find qualified workers."

The Fed has kept a close eye on the labor market and on signs of inflation.

"Remember, a strong labor market doesn't necessarily mean they are going to have inflation problems," Dunkelberg said. However, the business group did find inflation persists.

According to the survey, prices pressures no longer appeared to be abating. "The easing of inflationary pressures took a break," it said in its report.

After falling from a net 26% in April to 16% in October, the net percent of firms raising prices rose a point to 17%," NFIB said.

The latest NFIB survey was based on 451 responses from a random sample of 600,000 member firms.

Dunkelberg said he doesn't expect the Fed to increase interest rates for a while, despite these signs of inflationary pressures.

"I think the economy will remain slow enough to give them the room to sit tight," he said.