Small business owners are feeling increasingly pessimistic about the future, according to a recent survey by the National Federation of Independent Business. The survey found that sentiment dropped 0.9% in March, reaching its lowest level since December 2012. Inflation was cited as the top concern by the surveyed businesses, with more than a third of them having job openings they could not fill. Additionally, 43% of owners said they had raised their average selling prices.
The NFIB Chief Economist Bill Dunkelberg stated that inflation and the labor market continue to pose challenges for small business owners, with businesses facing various economic headwinds. About a quarter of the business owners surveyed cited inflation as their biggest operating problem. The rising costs of labor and inputs needed to run their companies were also seen as contributing factors to the decreasing optimism among small business owners.
In response to the increased costs, 38% of businesses surveyed reported raising worker wages in March. However, only 11% planned to create new jobs in the next three months. The number of business owners who identified the quality of labor as their top operating problem also increased, showing that there are challenges in finding skilled workers.
To offset the increased costs, many owners said they had raised their average selling prices. This increase was most pronounced in industries such as finance, retail, construction, and wholesale businesses. Fewer businesses are planning to make capital outlays, which could affect their ability to grow and expand.
The National Federation of Independent Business has been conducting monthly surveys since 1986 to track the sentiment and concerns of small business owners. The most recent survey, conducted in March, found that small businesses are struggling with rising costs, a tight labor market
