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Small business owners are more optimistic, but signal profit pain

Data: National Federation of Independent Business; Chart: Harry Stevens/Axios

Optimism on Main Street rose in February for the first time in nearly half a year, according to new survey data by the right-leaning National Federation of Independent Business, but the rebound is slight — higher than January's reading by just a half point.

The details: The most small business owners since 2017 reported weak profits, with 41% citing fewer sales, thanks to a more cautious consumer.

  • The NFIB blamed lingering effects of the government shutdown for tepid small business sales. "Earnings trends weakened as a million laid off workers and others affected by the shutdown cut back on spending. The reductions in sales fell immediately to the bottom line," the organization said in a press release.
  • The economy added only 20,000 new jobs last month, while outplacement firm Challenger, Gray & Christmas reported that businesses cut the most jobs in over 3 years in February.

One bright spot: Overall expectations that the economy and business conditions would improve were higher as compared to last month.

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