The rate of annual sales growth at private U.S. companies has slowed considerably since the beginning of 2102, according to data released by financial data firm Sageworks Inc.
The rate is currently at 5.4%, down from nearly 11% in January and down from about 8% at the same time last year, the study revealed.
Sageworks said the figures were drawn from financial statements filed by the companies during the past three months.
Sageworks said private companies drive “significantly more” than 50% of GDP and 65% of new job creation in the U.S. Consequently, private company financial performance is widely viewed as an important gauge of the health of the broader U.S. economy, the data firm said.
The company noted that the current 5.4% growth rate for private companies is currently stronger than that of the broader U.S. economy, but that it’s the slowest rate since Nov. 2010. The U.S. growth rate fell to 1.5% in the second quarter ending June 30.
A slew of economic data released in recent months has indicated that the U.S. economy has slowed since the beginning of the year. On Friday the U.S. Labor Department reported that the U.S. added just 96,000 jobs in August, the fifth month in a row that jobs data have disappointed.
According to Sageworks, an average of 139,000 jobs have been added each month so far in 2012. In 2011 the average monthly figure came to 153,000.
“The biggest issue for businesses right now is that they don’t know what is going to happen on major fiscal issues that affect their businesses. As such, they cannot plan out 12 and 24 months and adequately forecast their revenues, profits and cash,” Sageworks CEO Brian Hamilton said in a statement released with the results of the study.
“The slowdown in revenue growth could have significant implications on vital issues such as job growth and GDP. Hopefully, all of this does not indicate that we are sliding into another economic downturn,” Hamilton added.