BOSTON — Business confidence among Massachusetts companies has slumped to a 10-month low amid the latest surge of COVID-19 infections and persistent supply-chain issues, according to a new report.

The latest Business Confidence Index, which is compiled by the pro-business group Associated Industries of Massachusetts, shows overall enthusiasm among employers declined 1.2 points to 56.7 in December.

The report, which draws upon surveys of about 140 businesses, points out that while the state’s business confidence index is “within optimistic territory” — about 7.4 points better than a year ago — it has been on the decline for five consecutive months and remains the lowest level in nearly a year.

“Employers remain upbeat about the fundamental strength of the economy, but their confidence is muted by the evolving public-health crisis, rising prices and a structural labor shortage,” the report’s authors wrote.

Many employers are struggling to maintain operations and grow businesses amid the spread of the highly contagious omicron variant, which has driven up COVID-19 infections and hospitalizations, the report notes. Meanwhile, a prolonged hiring crunch and supply-chain issues have increased pessimism among many businesses.

John Regan, AIM’s president and CEO, said the latest data shows employers remain “fundamentally optimistic” about the economy “at a time of extraordinary hope and unprecedented uncertainty.”

“We face an ever-mutating public health crisis, a generational shortage of qualified workers, supply chain disruptions, the highest inflation since the early 1990s and shifting expectations about the nature of work itself,” Regan said.

The situation remains similar north of Boston, where a new business confidence index for the region was gauged at 57.8 in December — which is slightly higher than the state.

Meanwhile, state’s hiring crunch is getting worse, according to a new report that finds more than half of all employers are struggling to fill vacancies.

The latest survey by the National Federation of Independent Businesses found that 49% of all employers could not hire enough staff in December, while more than 28% of available positions went unfilled.

Meanwhile, 95% of business owners hiring or trying to hire reported few or no qualified applicants — a 48-year high, the group said.

Business leaders in Massachusetts say the data shows a deepening problem that is dragging on the economy. They are urging Beacon Hill policymakers to consider ways to ease the financial burden on employers as they struggle.

“That means refraining from piling on costly new mandates for our business owners at a time when employers are already struggling with rising labor costs, product shortages, and finding qualified workers for their job openings,” said Christopher Carlozzi, NFIB’s Massachusetts state director.

The latest NFIB survey found that a number of businesses are increasing compensation and effort to attract more employees. About 48% of employers who responded to the survey increased pay in December, while an additional 28% are planning to increase compensation in coming months.

Overall, about 60% of small employers said they were looking to hire new workers in December, according to the report.

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