The NFIB Small Business Optimism Index saw a slight increase of 0.3 points in September, reaching 91.5. This marks the 33rd consecutive month the index remains below the 50-year average of 98. However, the Uncertainty Index climbed by 11 points to a record high of 103.
"Small business owners are feeling more uncertain than ever," stated NFIB Chief Economist Bill Dunkelberg. He noted that uncertainty is causing hesitation among owners regarding capital investments and inventory, especially amid ongoing inflation and financing costs pressures.
Matt Everson, NFIB Iowa State Director, remarked on the situation in Iowa: "With the Uncertainty Index at an all-time high of 103, many of Iowa’s small businesses are hesitant to make long-term investments." He highlighted that this uncertainty, combined with declining inventory gains, suggests challenging times ahead for Main Street businesses in Iowa.
Key findings from the report include a drop in the net percentage of owners reporting inventory gains by four points to a net negative 13%, marking the lowest level since June 2020. The average rate paid on short maturity loans rose to 10.1%, its highest since February 2001. Thirty-four percent of owners reported job openings they could not fill during this period, a six-point decrease from August and the lowest reading since January 2021.
The survey also revealed that fifty-one percent of owners made capital outlays in the last six months, down five points from August levels. Of those expenditures, new equipment accounted for spending by 35% of respondents, vehicles by 23%, and facility improvements or expansions by 15%.
In terms of sales expectations, there was an increase in optimism as a net negative nine percent expect higher real sales volumes—an improvement from previous readings.
Inflation continues to be a significant concern for business owners, with twenty-three percent identifying it as their primary challenge due to increased input and labor costs.
Despite these challenges, some sectors like finance and retail reported frequent price hikes over recent months.
This data is part of ongoing research collected by the NFIB Research Center through quarterly surveys since late 1973 and monthly surveys since 1986. The current survey was conducted in September 2024.