The National Federation of Independent Business (NFIB) has released its latest Small Business Optimism Index, highlighting ongoing inflation concerns for Connecticut’s small businesses. The index increased by 2.2 points in July to 93.7, marking the highest level since February 2022 but remaining below the long-term average for the 31st consecutive month.
“Inflation continues to be the main hurdle for Connecticut’s small businesses,” said NFIB State Director Andy Markowski. “Cost pressures on Main Street have not eased much, and small business owners continue to adjust business operations to accommodate the rising prices.”
NFIB Chief Economist Bill Dunkelberg noted that despite an uptick in optimism, challenges remain due to persistent cost pressures. “Cost pressures, especially labor costs, continue to plague small business operations, impacting their bottom line. Owners are heading towards unpredictable months ahead, not knowing how future economic conditions or government policies will impact them,” he stated.
Among key findings from the survey, a net 33% of owners reported raising compensation in July—a decrease from June—and a net 24% plan price hikes this month. Inventory investment plans rose slightly while expectations for higher real sales volumes improved.
Employment remains a concern with 38% of all owners reporting job openings they could not fill during the current period, an increase from June. Of those attempting to hire in July, a significant majority cited difficulty finding qualified applicants.
Capital outlays were reported by 54% of owners over the last six months with investments made primarily in new equipment and vehicles. However, there is no change expected in capital outlay plans for the next six months.
Inflation was identified as the single most important problem by 25% of respondents while labor quality followed closely behind at 19%. Labor costs were highlighted as a top issue by nine percent of owners.
The NFIB Research Center conducts these surveys monthly since 1986 and quarterly since 1973. Data is collected randomly from NFIB’s membership base and aims to reflect trends among small businesses across America.
For further details about NFIB and its advocacy efforts on behalf of small businesses nationwide since its founding in 1943, visit nfib.com.
