Equality State News

The NFIB Small Business Optimism Index saw a decline of 2.3 points in January, settling at 102.8. Despite this decrease, the index remains above the long-term average for the third month in a row. The Uncertainty Index, however, increased by 14 points to reach 100, marking it as one of the highest recorded readings after two months of decline.

NFIB Chief Economist Bill Dunkelberg commented on the situation: “Overall, small business owners remain optimistic regarding future business conditions, but uncertainty is on the rise.” He highlighted ongoing hiring challenges and noted that fewer businesses are planning capital investments as they brace for upcoming months.

Michael Smith, NFIB State Director, urged state lawmakers to focus on supporting small businesses amid these challenges. "While our small business owners are hopeful future business conditions will improve," he said, "the ongoing labor shortage and inflationary pressures are fueling uncertainty."

Key survey findings include a five-point drop in the net percentage of owners expecting economic improvement since December and an unchanged 35% reporting unfilled job openings. Inflation and labor quality were tied as the top concerns for business owners.

In terms of pricing trends, there was a two-point reduction in the net percentage of owners raising average selling prices from December. Additionally, price hikes were most prevalent in finance and retail sectors among others.

Despite these issues, some positive trends were observed. Fifty-eight percent of owners reported capital outlays over the last six months with various expenditures including new equipment and facility improvements.

The NFIB has been collecting data on small business economic trends since 1973 through quarterly surveys and monthly reports since 1986. This particular survey was conducted in January 2025.