The National Federation of Independent Business (NFIB) released its Small Business Optimism Index for April, which showed an increase of 1.2 points to 89.7—the first time the index has risen in 2024. The 50-year average since the organization began collecting data in 1973 is 98.
After seeing an index consistently over 100 from 2017-2020, data show that small optimism peaked in August 2021 and has been hovering in the high 80s and low 90s since. Much of that is attributed to persistent inflation concerns, which was again cited as the most important problem in their business by 22 percent of respondents, while available labor quality (19 percent) and labor costs (11 percent) rounded out the top three.
“Cost pressures remain the top issue for small business owners, including historically high levels of owners raising compensation to keep and attract employees,” said NFIB Chief Economist Bill Dunkelberg. “Overall, small business owners remain historically very pessimistic as they continue to navigate these challenges. Owners are dealing with a rising level of uncertainty but will continue to do what they do best—serve their customers.”
Report highlights:
- The net percent of owners who expect real sales to be higher rose six points from March to a net negative 12 percent (seasonally adjusted).
- A seasonally adjusted net 12 percent of owners reported planning to create new jobs in the next three months, up one point from March’s lowest level since May 2020.
- A net 26 percent (seasonally adjusted) of owners plan price hikes in April, down seven points and the lowest reading since April of last year.
- Forty percent (seasonally adjusted) of all owners reported job openings they could not fill in the current period, up three points from March, which was the lowest reading since January 2021.
- The net percent of owners raising average selling prices fell three points from March to a net 25 percent seasonally adjusted.
The full report is available here.
Visit nfib.com for more information.
[05.21.24]