Small businesses are the engine of the American economy. Today’s NFIB Small Business Optimism Index dropped from 93.9 to 91.6. It appears that the index is having a very hard time breaking out above 95, even though its historical average is 98.1.
The greatest contributors to the index’s drop was a decline in hiring plans and worsening expectations for small business conditions. A record high number of the surveyed—37%—cited the political climate as a reason for their pessimism.
A 2012 report from the SBA found that small business generated 46% of American GDP in 2008 (the latest data available). That’s a hefty chunk of the nation’s productivity. Continued trouble for small businesses could become a drag on GDP growth.