State Firms’ Optimism at Two-Year High

California’s small-business owners are the most optimistic they have been in two years, according to a survey released Tuesday by a national small-business association.

“Overall, the news is quite good,” said Jim Weidman, a spokesman for the National Federation of Independent Businesses, the largest small-business group in the nation. “California small businesses are going to continue along with good, steady growth and hiring and wage increases.”

However, California businesses were less optimistic than the national average. Small-business owners throughout the country tallied a score of 101.1, compared with 96.8 in California. The state figure is up a full point from the last quarter of 1996.

The rise in optimism occurred despite a decline in earnings. California firms claiming lower fourth-quarter earnings outnumbered those with improved earnings by 19%. A quarter of respondents reported raising employee pay in the final quarter, the highest since the 1991 recession.

The survey also found that California businesses were holding the line on prices, Weidman said. Although many employers are in bidding wars for highly skilled workers, they are utilizing technological advances to reduce costs.

The NFIB queried more than 2,250 California business owners on 10 indicators such as hiring, wages and sales.