Sales expectations among small business owners improved modestly during October, to -4 from -6. However, the fact that the index remains negative indicates the economy is still deep in a recession and most operators expect sales to remain very weak despite increased holiday spending.
October marks the 21st month in which small business owners expected sales to decline over the ensuing three months. In March, the net percent expecting sales to decline was far greater, at 31%, so four percent is bullish in comparison. But in Octobers prior to the start of the recession, the net number has been far greater. Here is a look at Octobers past (seasonally adjusted):
Consumers have significantly tightened their belts this year as unemployment has continued to increase and there are few signs they will start freely spending any time soon. As a result, sales expectations will likely remain tempered in the near-to-medium term.