Small business owner optimism fell last month amid rising uncertainty, according to the National Federation of Independent Business..Released Feb. 10, January’s small business optimism index was down 0.2 points to 99.3, just above its 52-year average of 98. The index tracking uncertainty increased seven points to 91. “A rise in owners reporting uncertainty about whether it is a good time to expand their business was the primary driver of the rise in the uncertainty index,” according to NFIB. The employment index fell 1 point last month to 101.6, which erased half of the large increase in December, according to NFIB. Thirty-one percent of owners had job openings they could not fill, down two points from December. Twenty-five percent had openings for skilled workers, while 10 percent experienced openings for workers in jobs requiring little specialized training, experience or education. Overall business health improved in January, with a greater share reporting it as “excellent” and less seeing “fair” conditions. Owners expecting better business conditions dropped three points to a net 21 percent. A net 16 percent of owners plan to create new jobs in the next three months in January, down one point from the previous month. Half were either hiring or trying to hire in January, its lowest mark since the spring of 2020. Of those, the vast majority reported few or no qualified applicants. Sixteen percent of small business owners listed labor quality as their No. 1 problem, down three points from December. A net 32 percent raised compensation in January, up one point from the previous month. A net 22 percent expected to raise compensation in the next three months, down 2 points from December. As of Q3 2025, GDP increased at an annual clip of 4.2 percent, while inflation hovers at 2.7 percent. The current U.S. unemployment rate is 4.3 percent. “According to the official statistics, the economy is performing well,” NFIB stated. “GDP growth is strong, but not equally distributed across the country. Let’s see if 2026 brings more balance to these trends.” Sixty percent of small business owners made capital outlays in the last six months, up four points from December and its highest reading in more than two years. Of those, 44 percent spent on new equipment, 26 percent bought vehicles and 16 percent improved or expanded facilities. A net negative 6 percent of owners had higher nominal sales in the past three months, up two points from the previous month. Owners anticipating higher real sales volumes over the next quarter increased six points to 16 percent. Sixty-two percent of small business owners said supply chain disruptions were impacting their business, down two points from December. Forty-one percent listed “a mild impact,” while 37 percent saw no impact. Seventeen percent reported a moderate impact.The frequency of positive profit trends fell 1 point to a net negative 21 percent amid weaker sales, rising material costs and seasonal changes. Owners increasing average selling prices fell four points to a net 26 percent, still doubling the historical average of a net 13 percent. Thirty-six percent had higher average prices, while only 11 percent saw lower average selling prices.
