The National Federation of Independent Business (NFIB) released its latest Small Business Optimism Index, showing a slight decline of 0.2 points in January to 99.3. Despite the decrease, the index remains above its 52-year average of 98.
Ronda Wiggers, state director for NFIB in Montana, commented on the results: “The Index has been hovering above its 52-year average for a number of months now, which is a relief to those of us who remember when it consistently fell below it for the 34 consecutive months, post-pandemic. Has small business optimism finally found some long-lasting staying power? Tough to say. But NFIB will continue to push for policies in Helena and in Washington, D.C. that continue to push small businesses in the right direction, such as winning permanency of the 20% Small Business Tax Deduction from Congress and achieving lower income and property taxes from the Montana Legislature.”
Among the ten components measured by the Optimism Index, three increased while seven decreased. The most notable change was an increase in expected real sales volume by six points. The Uncertainty Index also rose by seven points from December to reach 91, driven mainly by more owners expressing uncertainty about expanding their businesses.
A new addition to this month’s report is the NFIB Small Business Employment Index. This index compiles several job-related questions into one figure and currently indicates a balanced labor market at 101.6—about 1.5 points higher than its historical average.
NFIB Chief Economist Bill Dunkelberg stated: “While GDP is rising, small businesses are still waiting for noticeable economic growth. Despite this, more owners are reporting better business health and anticipating higher sales.”
Additional findings from January include:
– Thirteen percent of respondents identified insurance costs or availability as their top concern, marking a four-point increase from December and reaching levels last seen in December 2018.
– Sixty percent reported making capital outlays over the past six months—the highest rate since November 2023.
– A net negative six percent said they paid higher interest rates on recent loans, down three points from December, indicating improved credit conditions for small borrowers.
– Fourteen percent rated their business health as excellent (up five points), while those rating it as fair dropped by seven points to twenty-seven percent.
More information about Montana’s small business environment can be found at www.nfib.com or on X at @NFIB_MT.
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