Small Business Optimism Fades in July

WASHINGTON - Small businesses spirits faded in July as owners reined in plans to create jobs and for capital spending, according to a survey released on Tuesday.

The National Federation of Independent Business Index said its index of small business optimism fell for the third straight month, slipping 1 point to 88.2, with half the decline due to weaker capital spending plans.

Plans to make capital spending over the next few months fell 5 points to 21 percent, the weakest reading since the 1970s, the NFIB said.

"Getting a discount on loans or the purchase price of equipment is not sufficient to stimulate much spending if the equipment isn't needed to serve customers," said NFIB Chief Economist William Dunkelberg.

Over the next three months, 5 percent of the owners plan to create new jobs, unchanged from June, the group said. Ten percent of the owners reported that the availability of qualified labor was their top business problem.

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Source: Reuters