Three months of rising confidence among small business owners stalled in December, as fewer saw the economy getting better and more said they saw it getting worse, according to a new survey.

The Discover Small Business Watch monthly index dropped to 81.6 in December, down 5.6 points from November. The index remains 4.6 points higher than one year ago.

Twenty-five percent of small business owners said the economy is getting better this month, down from 33 percent in November; 51 percent said it is getting worse, up from 46 percent; and 22 percent said the economy is staying the same, up from 17 percent the prior month.

"Through the four years we've been studying them, small business owners have remained a bit fickle when it comes to their confidence in the economy," said Ryan Scully, director of Discover's business card. "Like the rest of us, they're seeing some positive signs, but they aren't ready to declare victory, especially not with 62 percent of them still rating the economy as poor."

Twenty-five percent of small business owners expect economic conditions for their businesses to improve in the first half of 2011, a drop from 28 percent a month ago; 26 percent expect conditions to remain the same, up from 24 percent; and 43 percent expect conditions to worsen, down from 44 percent in November.

Twenty-one percent of small business owners will increase spending on business development in the next six months, down from 25 percent in November. Forty-two percent will decrease business development spending, up from 40 percent; and 32 percent do not plan any changes, up from 28 percent last month. 62 percent rate the current economy as poor, up from 59 percent in November; 30 percent rate the economy fair; 5 percent rate it good; and 3 percent rate it excellent. 45 percent have encountered temporary cash flow issues within the last 90 days that have caused them to hold off on paying some bills, up from 43 percent in November, while 49 percent have not had cash flow issues; and 6 percent were not sure.

The number of small business owners who have a financial plan for retirement is down from a year earlier, when the Watch first surveyed small business owners on the topic. This year, 50 percent of small business owners said they have a financial plan for their retirement, down from 62 percent in 2009.

At the same time, the recession has depleted the savings of 74 percent of small business owners, the same number as last year, while 20 percent said the recession had no impact, and 5 percent saw their retirement savings increase.

When asked how much of their retirement savings they had lost, fewer small business owners than last year reported that they had lost between 30 and 50 percent of their savings.

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