| Consensus | Consensus Range | Actual | Previous | |
|---|---|---|---|---|
| Index | 89.0 | 88.9 to 90.5 | 90.1 | 90.9 |
Highlights
The NFIB small business optimism index is up to 90.1 in March after 90.9 in February. The reading is above the consensus of 89.0 in an Econoday survey. The increase is slight, but does suggest some improvement in underlying conditions. The report said that inflation remains the"single most important problem" for small business operators, although business owners reported an improvement from the prior month. The report also noted that the index level remains below the 49-year average of 98 and has been there for 15 straight months.
Index components had a few big moves in March that leaves the overall index lower. Three of 10 components are higher, six are lower and one is unchanged.
The largest decrease is in expectations for higher sales, down 6 points to minus 15 percent, and the lowest since minus 19 percent in August 2022. There are decreases of 4 points in current job openings to 43 percent, and credit conditions are down 3 points to minus 9 percent.
The largest increase is 5 points in satisfaction with current inventory at 1 percent and the earnings trend at minus 18 percent.
There is no change in expectations for the economy to improve at 47 percent.
Index components had a few big moves in March that leaves the overall index lower. Three of 10 components are higher, six are lower and one is unchanged.
The largest decrease is in expectations for higher sales, down 6 points to minus 15 percent, and the lowest since minus 19 percent in August 2022. There are decreases of 4 points in current job openings to 43 percent, and credit conditions are down 3 points to minus 9 percent.
The largest increase is 5 points in satisfaction with current inventory at 1 percent and the earnings trend at minus 18 percent.
There is no change in expectations for the economy to improve at 47 percent.
Market Consensus Before Announcement
The small business optimism index has been below and often substantially below the historical average of 98 for 14 months in a row. March's consensus is 89.0 versus 90.9 in February.
Definition
The small business optimism index is compiled from a survey that is conducted each month by the National Federation of Independent Business (NFIB) of its members. The index is a composite of 10 seasonally adjusted components based on the following questions: plans to increase employment, plans to make capital outlays, plans to increase inventories, expect economy to improve, expect real sales higher, current inventory, current job openings, expected credit conditions, now a good time to expand, and earnings trend.
Description
Small businesses are responsible for a majority of new job creation and the NFIB focuses on this sector of the economy. The direction of the health of small businesses can portend changes in the stock market - especially small caps.
