What it means: According to NFIB’s survey of small business owners, uncertainty remains high, and labor quality persists as a top problem. The survey’s findings offer insights into some of the causes behind the rise in uncertainty for small businesses, which include inflation and labor quality.

Our take: “Uncertainty is high and rising on Main Street – and for many reasons. Those small business owners expecting better business conditions in the next six months dropped, and the percentage viewing the current period as a good time to expand fell but remains well above where it was in the fall. Inflation remains a major problem, ranked second behind the top problem, labor quality,” said NFIB Chief Economist Bill Dunkelberg.

According to NFIB’s February Small Business Economic Trends report, optimism declined, and uncertainty remained high, rising four points. Reports of job openings that small businesses could not fill were up three points from January and the highest reading since August 2024.

In this month’s survey, NFIB introduced a new question to understand how small business owners evaluated the overall health of their business with 11% reporting it as excellent, 55% good, 27% okay, and 6% bad. Other key findings include:

• The net percentage of owners expecting the economy to improve fell ten points from January to a net 37% (seasonally adjusted).
• Twelve percent (seasonally adjusted) of owners reported that it is a good time to expand their business, down five points from January. This is the largest monthly decrease since April 2020.
• Sixteen percent of owners reported that inflation was their single most important problem in operating their business, down two points from January and now just below labor quality as the top issue. 
• The net percentage of owners raising average selling prices rose 10 points from January to a net 32% (seasonally adjusted). This is the largest monthly increase since April 2021, and the third highest in the survey’s history.

“Small businesses in the construction, manufacturing, retail, and services industries are not only optimistic but hopeful that business conditions will finally improve. Looking forward, firms in these four sectors anticipate improved sales, increased opportunities for growth, and a pro-business economic environment that enables Main Streets to thrive,” said Holly Wade, Executive Director of the NFIB Research Center. The NFIB Research Center has collected Small Business Economic Trends data with quarterly surveys since the fourth quarter of 1973 and monthly surveys since 1986. Survey respondents are randomly drawn from NFIB’s membership. The report is released on the second Tuesday of each month. This survey was conducted in February 2025.