The National Federation of Independent Business (NFIB) reported that its Small Business Optimism Index declined to 104.8 during November. It was down for the third straight month and lower than August's record high of 108.8. The index level fell 2.5% y/y.

The decline in the overall index reflected weakness in several categories. Twenty-two percent of respondents expected the economy to improve, down from 33% during October. Twenty-four percent expected higher real sales, down from 28%. A lessened 29% thought that now was a good time to expand the business.

Potential pricing power intensified. An increased twenty-nine percent firms were planning to raise prices, a ten-year high. Current pricing pressure remains fairly stable. A net 16% of firms were raising average selling prices, the same as in October but below the 19% May high.

Labor market readings were mixed m/m. Twenty-two percent of respondents planned to increase employment, but that remained down from the record 26% in August. A stable 53% were finding few or no qualified candidates for job openings. That was increased, however, from 44% a year ago.

Pressure to raise worker compensation intensified. A near-record 25% of firms were planning to raise compensation and a near-record 34% were doing so now.

Credit became somewhat more difficult to get. Five percent of businesses reported difficulties in obtaining it. That was increased from a two percent June low.

The small business survey inquires about problems facing small business. The most pressing problem in November was the quality of labor. A record twenty-five percent reported problems versus 18% during all of last year. A higher 19% indicated that taxes were the largest problem, but that remained down from a December 2014 high of 27%. Government requirements were worrisome to a significantly lessened 13% of respondents, below the 22% in 2015. Competition from large businesses eased to eight percent as the biggest problem, down from 11% in March. A greatly increased seven percent of firms reported the cost of labor as the most significant problem. Insurance costs/availability worried a slightly lessened 10%. Poor sales inched up to eight  percent but that remained near the record low. Financial & interest rate problems worried a stable two percent of respondents. A minimal one percent reported inflation as the biggest problem.

Roughly 24 million small businesses exist in the U.S. and they create 80% of all new jobs. The index is based 1986=100. The typical NFIB member employs 10 people and reports gross sales of about $500,000 a year.

The NFIB figures can be found in Haver's SURVEYS database.