Poll: Optimism at historic low
Survey notes hefty drop was recorded before stimulus package OK’D
The National Federation of Independent Business’ small business optimism index dropped 5.5 points in December, falling to a historic low for the group’s index, which has been surveying small businesses across the country monthly since 1986.
The survey was sent out at the start of December and most responses came back before Congress passed the most recent COVID-19 stimulus package and President Trump signed it into law. President and CEO of the Capital Region Chamber Mark Eagan believes January’s optimism index will be higher thanks to the new relief.
“There was such a long time where Congress took no action,” Eagan said. “I think businesses were concerned that they were out on their own.”
The Capital Region Chamber surveyed businesses in the area between Nov. 17 through Dec. 4 and found 40 percent of the 204 businesses that responded said they needed financial assistance due to the negative impact of the
pandemic.
While Eagan is hopeful for small businesses because they have the new funds and they can finally see the light at the end of the tunnel, December’s optimism index drop is significant because previously, from July 2020 to October 2020, the optimism index had been increasing.
“This is one of the most significant month-to-month drops that we’ve seen,” said Greg Biryla, the New York state director of the national association. “To have it drop 5.5 points in one month is unfortunate to see that abrupt stop of a trend that was previously increasing.”
The index is made up of 10 components. Two of them had the most notable change in December, Biryla said. The expectation that the economy will improve dropped by 24 points, and the sales expectation over the next three months dropped by 14 points, since November’s index.
Reasons for the declines include another surge in coronavirus cases, tighter restrictions in some parts of the country, and because the holiday month is often a big month for small businesses, so in comparison to years past, optimism shriveled, Biryla said.