NFIB Research Center Executive Director Holly Wade recently spoke with Brad Smith of Yahoo! Finance about the latest Small Business Optimism Index. The index, which measures sentiment among small business owners, rose above its 50-year average in November for the first time since 2021.

Wade highlighted data from NFIB's November SBET survey, explaining factors contributing to increased optimism among Main Street business owners. She noted that expectations for improved business conditions and higher sales in the coming months were significant drivers of this positive outlook.

In her discussion, Wade stated, "Small business owners are far more optimistic these days. The last month we saw a huge surge in our index looking at small business optimism. The biggest contributor to that was general business conditions." She added that many small business owners are eager for changes in economic policy and have high expectations for tax policy and regulatory environment shifts going into 2025.

A key concern is the expiration of provisions from the Tax Cuts and Jobs Act of 2017, particularly the 20% Small Business Deduction. Wade explained, "We have a year, 12 months, for Congress and the Administration to extend or, preferably, make permanent those provisions that have been so helpful." She mentioned that uncertainty about potential tax increases had previously worried small business owners but noted a decrease in NFIB's Uncertainty Index as a sign of growing confidence.

Labor quality remains a significant challenge for one in five small businesses according to Wade. "It remains a tight labor market for small firms," she said, especially affecting industries like construction and transportation. Despite challenges in hiring due to historically high job openings, there is ongoing pressure on compensation costs as businesses strive to recruit and retain employees.

For more details on this topic, readers can view Holly Wade’s full interview on Yahoo! Finance’s website.