Small-business optimism dipped a bit in January, according to the latest monthly Small Business Optimism Index released earlier this month by the National Federation of Independent Business (NFIB). But, for a third consecutive month, the index came in higher than its 51-year average.
NFIB’s index is used by the Federal Reserve, congressional leaders, administration officials and state legislatures across the nation as a gauge on the health and welfare of the Main Street enterprises that employ half of all workers, generate more net new jobs than large corporations, and gave most of us the first start in our working life, NFIB said. The report is a national snapshot of NFIB-member, small-business owners not broken down by state.
“A third consecutive month above the Index’s 51-year average is what the important news is; before that there were 34 consecutive months below the average,” said Casey Hill, state director for NFIB in Utah. “If Congress and the Utah State Legislature can adopt policies that foster small-business stability, there’s a much better economy for all ahead. In the meantime, small-business owners will work to head off harmful legislation from becoming law, such as the original draft of Utah House Bill 24, which meant well in attempting to help people overcome some past mistakes in getting a job but which wound up becoming a greater regulatory and liability headache for small-business owners willing to take the risk. I’m thankful for the NFIB members who answered our action alert to lobby their legislators for amendments to HB24 that has made it much friendlier to Main Street enterprises.”
“Overall, small-business owners remain optimistic regarding future business conditions, but uncertainty is on the rise,” said NFIB Chief Economist Bill Dunkelberg. “Hiring challenges continue to frustrate Main Street owners as they struggle to find qualified workers to fill their many open positions. Meanwhile, fewer plan capital investments as they prepare for the months ahead.”
Highlights from the latest Small Business Optimism Index:
- The net percent of owners expecting the economy to improve fell five points from December to a net 47 percent (seasonally adjusted).
- Thirty-five percent (seasonally adjusted) of all owners reported job openings they could not fill in the current period, unchanged from December.
- Twenty percent (seasonally adjusted) plan capital outlays in the next six months, down seven points from December.
- A net 3 percent of owners reported that their last loan was harder to get than in previous attempts (down one point). The last time it was this low was June 2022.
- A net zero percent (seasonally adjusted) of owners plan inventory investment in the coming months, down six points from December’s highest reading since December 2021.
The full Optimism Index results are available at www.nfib.com.
