Owners’ outlook for business conditions rose 10 points, NFIB says
The National Federation of Independent Business reported Tuesday that its small-business optimism index rose 2.1 points in June to 97.4, topping the 95.7 reading that economists polled by The Wall Street Journal had forecast.
The index, which provides a monthly snapshot of small businesses that account for nearly half of U.S. private-sector jobs, rose for the first time this year after declines in prior months.
NFIB Chief Economist Bill Dunkelberg attributed the improvement partly to lower fuel costs. “Lower fuel costs provide welcome relief for businesses as well as consumers, with firms anticipating improved operating conditions over the next six months,” Dunkelberg said in a statement.
The net percentage of owners expecting better business conditions in the next six months rose 10 points in June to a net 13%, the first increase this year after declines in the first five months. The net percentage of owners who reported raising average selling prices rose from May, marking the fourth consecutive month that actual price increases have risen and the highest level since January 2023. Meanwhile, the share of owners planning to raise prices in the near future declined.
Despite the positive signals, Dunkelberg said high interest rates and modest economic growth continued to cause owners to approach hiring and capital spending with caution. Small businesses are often more sensitive than larger firms to sudden price fluctuations, higher interest rates and broader economic uncertainty, according to the NFIB.