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Small-Business Optimism in U.S. Declines From One-Year High

July 9 (Bloomberg) -- Confidence among U.S. small businesses cooled in June after reaching a one-year high the prior month even as more companies said they plan to add jobs.

The National Federation of Independent Business’s optimism index decreased to 93.5 last month from 94.4. The June figure was the second-highest in a year. Five of the measure’s 10 components contributed to the decline, the Washington-based group said.

The share of business owners expecting sales to increase fell by 3 percentage points to 5 percent in June, and fewer companies planned to increase inventories. At the same time, a measure of job creation plans was the fourth-highest since 2007 and there was less pessimism about the outlook for the economy.

“The economy remains bifurcated, with the big firms producing most of the GDP growth with little help from small business,” William Dunkelberg, the group’s chief economist, said in a statement. “That balance is shifting, but unfortunately because larger firms are losing ground, not because small business is growing faster.”

The NFIB report was based on a survey of 662 small-business owners through June 30. Small companies represent more than 99 percent of all U.S employers, according to the U.S. Small Business Administration. A small business is defined as an independent enterprise with no more than 500 employees.

To contact the reporter on this story: Alexandria Baca in Washington at abaca3@bloomberg.net

To contact the editor responsible for this story: Christopher Wellisz at cwellisz@bloomberg.net

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