WASHINGTON -- Small business owners were more optimistic about their prospects in February, but their overall confidence in the economy remained low, according to a leading private barometer.
The Small Business Optimism Index from the National Federation of Independent Business rose to 90.8 in February, up 1.9 points from the previous month. Although the increase was positive, the group noted that reading was similar to the average from 2008, as the Great Recession was taking hold.
"The index gained almost 2 points last month; that was good news," said NFIB chief economist Bill Dunkelberg. "But until owners’ forecast for the economy improves substantially, there will be little boost to hiring and spending from the small business half of the economy."
Although Fortune 500 companies reported record 2011 earnings, small business earnings "remain depressed," he said.
Sales have been weak and policy gridlock in Washington has added to the problems, Dunkelberg said.
Eight of 10 components of the index rose in February, led by a 4 percentage point rise -- to 25% -- in firms planning to increase capital spending and inventory investment during the next six months.