The National Federation of Independent Business (NFIB) released its Small Business Economic Trends report on May 12 2026. It showed that the Optimism Index went up slightly by 0.1 points in April to 95.9. This is an improvement from Marchs 95.8. However it is still below the long-term average of 98.0 for the month in a row. This means that small business owners in America are still being careful because of the challenging economy.
NFIB Chief Economist Bill Dunkelberg said that things are still fragile. He noted that inflation is still a problem for businesses. He also said that the Working Families Tax Cut Act will help businesses in the coming months. Even though things are a bit stable there is still a lot of uncertainty. The Uncertainty Index went down 4 points to 88. This is still much higher than its average of 68.
Some parts of the index showed results. Seven out of ten sub-indicators got a bit better in April. The current earnings trends went up by 6 points. Plans to increase inventory and inventory levels also went up. However some business owners are less optimistic about the future. 7% Of owners think now is a good time to expand. This is the lowest since October 2024.
The job market is still tight. Also showing some weakness. The Employment Index went down to 100.4. Many business owners said they have job openings. However they are struggling to find workers. Many owners also raised wages. Not as much as before.
More business owners are worried about inflation. The number of owners raising their prices went up 5 points to 30%. This is much higher than usual. Business owners are passing on their costs to customers. This shows that small businesses are dealing with costs.
Despite these challenges some signs are positive. A net 13% of owners plan to hire workers. Credit conditions seem stable. Many owners are focusing on being more efficient and hiring carefully.
The April data shows that small businesses are holding steady. They are not growing rapidly. The slight increase in optimism is good but not enough. The index is still below its level. This means that business owners are still worried about inflation, labor shortages and policy impacts.
As the second quarter of 2026 continues small businesses will be an indicator of the US economy. Small businesses employ half of the private workforce. If they stay stable it could affect hiring, investment and consumer spending. For now stability, at 95.9 shows that small businesses are resilient. However they need to grow to show a strong recovery.
