The percentage of owners expecting better business conditions over the next six months decreased 14 points to a net negative 49%, according to a new National Federation of Independent Business (NFIB) report, which is the lowest level recorded in the 48-year-old survey.
“Those kinds of numbers are telling us that small business owners are still skeptical, concerned, and frightened about what the future holds,” said John Kabateck, NFIB’s California state director.
NFIB’s Small Business Economic Trends report, also known as the monthly Optimism Index, determined that 47% of business owners reported job openings that could not be filled, which is one point lower than the month of February.
“What we're finding is that owners of small businesses today still do not feel there's a light at the end of the tunnel at least anytime soon,” Kabateck told the Southern California Record.
That’s partly due to the rising price of fuel, according to Kabateck.
“At the very core of this is a continued upward spiral in the cost of gas and fuel that it impacts the corner florist and baker who rely on deliveries and (the) small business owner who relies on natural gas for the operation of their restaurant, and certainly the consumers who are not only looking to get to and from work but also to purchase goods,” he said.
The study further found that the net percent of owners raising average selling prices increased four points to a net 72% (seasonally adjusted), which is the highest reading in the survey’s history.
“We're witnessing fewer items on shelves, which means fewer things to sell, which leads to fewer jobs and hastens the scaling back of corner neighborhood stores,” Kabateck added.
In addition to rising fuel prices, Kabateck blames inflation.
“Small businesses are particularly hit hard because they can't rely on the large distribution centers that the bigger business stores can,” he said. “Many of them are working business-to-business, trying to get things from local suppliers but those local suppliers are out. So, the second cornerstone is this rising inflation coupled with supply chain disruptions.”
As previously reported in the Wall Street Journal, inflation increased to 8.5%, a 40-year high.
"A third factor is our California lawmakers who are doing zero to address the recent spike in retail theft," Kabateck added.
"Our Sacramento politicians are talking the talk about supporting our law enforcement officers, restoring some criminal justice policies back to holding these criminals accountable but we've seen zero. We've seen no action there. In the past two weeks, both the Assembly and Public Safety Committee had upwards of 15 bills to address mitigating the shoplifting and property crime issue and none of them moved in the direction of passage. None of them made it out of committee."