NFIB Small Business Optimism Index Falls in February

Posted on March 11, 2026

On Tuesday, the National Federation of Independent Business (NFIB) reported that its Small Business Optimism Index (SBOI) fell 0.5 points to 98.8 in February. This was 0.8 points above the 52-year average of 98.

The NFIB Uncertainty Index fell 3 points to 88, reflecting shifting expectations among owners about whether it is a good time to expand their business.

Other key highlights from the February SBOI include:

  • Overall business health: 12% of owners rated their business health as excellent (-2); 55% rated it good (+1); 26% rated it fair (-1); and 5% rated it poor (+1).
  • Labor quality: 15% of owners cited labor quality as the single most important problem, down 1 point from January and marking the fourth consecutive monthly decline. The last time labor quality was this low was in April 2020.
  • Employment: The Employment Index ticked up nearly 1 point to 103.5 in February, 3.5 points above its historical average of 100 and 2.3 points above its 2025 average. The increase was driven primarily by compensation-related components rather than employee-count measures.
  • Nominal sales: A net 1% of owners reported higher nominal sales in the past three months, up 7 points from January and close to the historical average of a net 0%. The last time actual sales were this strong was in May 2022.
  • Sales expectations: The net percent of owners expecting higher real sales volumes fell 8 points to a seasonally adjusted net 8%.
  • Supply chains: 59% of small business owners reported that supply chain disruptions affected their business to some extent, down 3 points from January.

In remarks accompanying the release, NFIB Chief Economist Bill Dunkelberg said:

“Although optimism declined slightly, small businesses report feeling more certain in February as they look toward the coming months. High sales and increased profits made February a more positive month for many owners, but competition from large businesses is putting stress on Main Street firms as they navigate the current economic climate.”

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