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Number of Businesses Reporting Falling Sales Tripled From Last Year

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A recent survey of businesses has found that fewer are reporting higher sales compared to the same time last year, while the number of those reporting shrinking sales has dramatically increased, according to CNN Money. The data from the National Association for Business Economics showed that the number of firms reporting increased sales in the last quarter went from 61 percent last year to 47 percent this year. Conversely, those reporting falling sales nearly tripled in the same time frame, going from 6 to 17 percent. Not even the holiday season was a relief, as 20 percent of firms reported their profits fell in that period, compared to just 8 percent in October. The businesses don't seem terribly optimistic about 2019, as just 14 percent believe they will have a bigger first quarter than last year. CNN named the slowing global economy, escalating trade tensions and stock market volatility as reasons. 

Another major factor could be the record-breaking government shutdown, which ended only this past weekend. While the government was closed, many government functions that businesses rely on were nonoperational, and the consequences of missing out on them for so long could have long-term impacts on business operations, according to the Wall Street Journal. For instance, because the Securities and Exchange Commission was shut down, companies were unable to proceed with IPO plans and lacked the ability to block shareholder proposals. The shutdown has also impacted consumer sentiments, according to the Journal, which could adversely affect sales. What's more, while the government has now reopened, the president has indicated a willingness to shut it down again if negotiations over border security fall through, though the Journal quoted Capital Economics analysts who predicted that, given what happened the last time, he is unlikely to do so.