Cornhusker State News

The NFIB Small Business Optimism Index experienced a decline of 2.3 points in January, reaching 102.8. Despite this drop, it remains above the 51-year average of 98 for the third consecutive month. The Uncertainty Index saw an increase of 14 points to 100, marking its third-highest recorded reading after two months of decline.

"Overall, small business owners remain optimistic regarding future business conditions, but uncertainty is on the rise," said NFIB Chief Economist Bill Dunkelberg. He added that hiring challenges continue to frustrate Main Street owners as they struggle to find qualified workers for their open positions and noted a decrease in plans for capital investments.

In Nebraska, NFIB State Director Ryan McIntosh highlighted that local small business owners are focused on modernizing operations despite economic uncertainties. However, he pointed out that finding qualified workers remains a significant concern with "47% of owners reporting few or no qualified applicants." McIntosh urged lawmakers to pass pro-small business legislation to address these challenges.

Key findings from the report include:

- A net 47% of owners expect the economy to improve, a five-point drop from December.

- Inflation was cited by 18% of owners as their most pressing issue, matching labor quality concerns.

- The percentage of owners raising average selling prices decreased by two points to a net 22%.

- Thirty-five percent reported job openings they could not fill, unchanged from December.

- Plans for capital outlays in the next six months fell by seven points to 20%.

The survey also revealed that labor quality and costs remain significant issues for small businesses. While compensation increases were reported by a net 33%, plans for further raises dropped slightly.

Capital expenditures were reported by 58% of owners over the past six months, with investments in new equipment being most common. Meanwhile, sales expectations have seen a decline with a net negative 14% reporting higher nominal sales recently.

Inventory management also presented challenges; a net negative six percent reported inventory gains while price hikes were frequent across various sectors including finance and retail.

Credit availability remained stable with three percent indicating unmet borrowing needs and only three percent identifying financing as their top issue.

The NFIB Research Center has been collecting data on small business economic trends since the fourth quarter of 1973 through quarterly surveys and monthly surveys since 1986. The latest survey was conducted in January 2025.