The National Federation of Independent Business (NFIB) Small Business Optimism Index dipped in August to 98.7, just 1.1 points below July’s highest level since August 2025, but remaining above the 52-year average of 98.0. The Uncertainty Index fell 2 points to 89, remaining above the historical average of 68.
“Uncertainty remains elevated among small business owners as they face a mixed set of challenges with weakened sales, supply chain disruptions, and inflation pressures,” said Bill Dunkelberg, chief economist for NFIB. “While expectations for the overall economy dimmed, Main Street owners remain largely positive in the health of their own businesses.”
Key findings include:
- Reports of “labor quality or availability” and “labor costs” as owners’ single most important problem eased in August, with “labor costs” dropping to its lowest level since March 2021.
- Expectations for better business conditions deteriorated 5 points to a net 10 percent (seasonally adjusted) but remain above the average of net 4 percent.
- When asked to evaluate the overall health of their business, 11 percent of owners rated it as excellent (down 3 points), 57 percent as good (up 2 points), 28 percent as fair (up 2 points), and 3 percent as poor (down 1 point).
- Actual sales worsened in August, with a seasonally adjusted net negative 9 percent of owners reporting higher nominal sales in the past three months, down 5 points from July and the lowest reading since November 2025.
- Reports of inflation as the single most important problem increased 2 points in August to 16 percent.
- Sixty-two percent of small business owners reported that supply chain disruptions affected their business to some extent, down 1 point from July.
A seasonally adjusted 35 percent of all small business owners reported job openings they could not fill in August, down 1 point from July, but 11 points above the historical average. Of the 56 percent of owners hiring or trying to hire in August, 82 percent reported few or no qualified applicants for the positions they were trying to fill. A seasonally adjusted net 17 percent of owners plan to create new jobs in the next three months.