NFIB Survey: Inflation Still Top Issue for Small Business Owners
COLUMBUS, Ohio – Chris Ferruso, NFIB Ohio state director, said the latest NFIB Small Business Optimism Index highlights the impact rising costs have on Ohio’s small and independent businesses.
“Inflation continues to hurt Ohio’s small businesses as prices have eased only slightly,” Ferruso said. “Small business owners are making business adjustments and scaling back to accommodate the various cost pressures they are facing.”
The NFIB Small Business Optimism Index rose 2.2 points in July to 93.7, the highest reading since February 2022. However, this is the 31st consecutive month below the 50-year average of 98. Inflation remains the top issue among small business owners, with 25% reporting it as their single most important problem in operating their business, up 4 points from June.
“Despite this increase in optimism, the road ahead remains tough for the nation’s small business owners,” said Bill Dunkelberg, NFIB chief economist. “Cost pressures, especially labor costs, continue to plague small business operations, impacting their bottom line. Owners are heading toward unpredictable months ahead, not knowing how future economic conditions or government policies will impact them.”
Key findings include:
- Seasonally adjusted, a net 33% reported raising compensation in July, down 5 points from June and the lowest reading since April 2021.
- A net 2% (seasonally adjusted) of owners plan inventory investment in the coming months, up 4 points from June. The last time inventory investment plans were positive was in October 2022.
- The net percent of owners expecting higher real sales volumes rose 4 points in July to a net negative 9% (seasonally adjusted), the highest reading of this year.
- The net percent of owners raising average selling prices fell 5 points from June to a seasonally adjusted net 22%.
- Seasonally adjusted, a net 24% plan price hikes in July (down 2 points). This is the lowest reading since April 2023.
- Thirty-eight percent (seasonally adjusted) of all owners reported job openings they could not fill in the current period, up 1 point from June.
As reported in NFIB’s monthly jobs report, a seasonally adjusted 38% of all small business owners reported job openings they could not fill in their current period, up 1 point from June. Of the 57% of owners hiring or trying to hire in July, 86% reported few or no qualified applicants for the positions they were trying to fill.
Fifty-four percent of owners reported capital outlays in the past six months, up 2 points from June. Of those making expenditures, 36% reported spending on new equipment, 22% acquired vehicles and 15% improved or expanded facilities. Ten percent spent money on new fixtures and furniture, and 7% acquired new buildings or land for expansion. Twenty-three percent (seasonally adjusted) plan capital outlays in the next six months, unchanged for the third consecutive month.
A net negative 16% of all owners (seasonally adjusted) reported higher nominal sales in the past three months. The net percent of owners expecting higher real sales volumes rose 4 points to a net negative 9% (seasonally adjusted), the highest reading of this year.
Published by The Business Journal, Youngstown, Ohio.
