The NFIB Small Business Optimism Index declined 0.8 points in September to 97.9, one-tenth of a point below its 52-year average of 98.0. The Uncertainty Index rose 1 point to 90, well above its historical average of 68. Expectations for better business conditions over the next six months fell 4 points to a net (better minus worse) 6%, while the share of owners reporting that it was a good time to expand declined 5 points to 7%. Labor quality or availability, remained the most frequently cited business problem, rising 3 percentage points to 26%, while inflation concerns rose 4 points to 20%, well above its historical average of 7%.
The ABA Office of the Chief Economist believes the September survey points to continued caution among small businesses amid elevated uncertainty and persistent cost and labor pressures. Slower expansion plans could weigh on demand for small-business credit, while sustained inflation and labor costs may pressure small-business margins and debt-service capacity. For banks, these dynamics could temper commercial loan demand.
