Economy: NFIB Small Business Optimism Index (SBOI) for JULY 2026

The National Federation of Independent Business® (NFIB®) released its Small Business Optimism Index (SBOI) for July, 2026:
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Predicted: 99.0

Actual: 99.8

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Change from Previous Month: +2.46% (+2.4 points.)

Change from A Year Ago: -0.5% (-0.5 point.)

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CHART: NFIB Small Business Optimism Index

JULY 2026 Update

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The baseline "100" score is associated with 1986 survey data.

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From The Report:

"...MEMBER QUOTES

Labor:

“We struggle to find skilled labor/trades.” – Construction, NY

“The ability to find/hire competent workers in the HVAC field is increasingly more difficult year to year. It is absolutely necessary to help promote and fund the mechanical trades, particularly the HVAC trade!” –
Construction, CT

“Labor is a challenge. We currently rely on older or retired help. […]” – Retail, PA

“Very hard to find skilled machinists who still know manual machines.” – Manufacturing, OH

“This is the worst period for hiring skilled labor. I have positions open today that pay well with benefits, but there aren’t any qualified candidates. I have used Indeed, ZipRecruiter, social media, banners, website, etc.”
– Retail, PA

“Finding or having qualified skilled labor applicants is nonexistent.” – Services, SC

“Forty-eight years in business for myself, and the toughest issue has been finding good people to hire and how to compensate them fairly. Health insurance is a disaster – costs more and pays less. Employees want more compensation for less work/production. To keep this trend going we must find easier ways to do tough jobs and charge higher prices with stiff compensation.” – Services, NC

“In the transportation industry it’s very hard right now to find help. I’ve had three trucks out of twelve sitting idle for six months now. I can find drivers, but they aren’t drivers I trust.” – Transportation, IL

“Unskilled labor shortage is our biggest problem. […]” – Agriculture, NC

“We are highly seasonal as a farm and do not have steady income. Every year is different depending on market conditions, crop (apple) size, and import/export options… We have a severe labor shortage, which many of us have turned to the federal H-2A program to meet our needs. Labor is now greater than 50% of our input costs due to the rise in benefits, overtime, paid sick days, and base wage rates.” – Agriculture, NY

“Our biggest problem is that we cannot find qualified, skilled employees.” – Agriculture, MN

“Finding and retaining good employees is our biggest challenge. It has never been easy but declined substantially during COVID, and even though it has improved since then, it is still something that our
manager spends way too much time on and it affects all areas of our business.” – Manufacturing, VA

“Our biggest obstacle is finding technicians with experience. It is also difficult to find office employees. Most [people] we hire off the street do not last. [They] miss a lot of work.” – Construction, AZ

“Engineers generally do not go looking for better jobs as much as [those] in other fields. They tend to sit tight and not rock the boat. We are trying to hire an experienced engineer or two, but they just aren’t out there. So we are being forced to hire engineers out of school or inexperienced.” – Professional/business services, OH

“Biggest issue in our industry is the lack of skilled workers on our job sites, in our fabrication shops, and with our suppliers.” – Construction, IN

“Business is good. Hoping for everything to get better and for costs not to continue to rise as they have been. The labor workforce is getting slim, and [it] seems like quality people are getting harder to find in
labor fields.” – Services, TX

“We have a weird situation where I can get more unskilled labor than I need. But I am unable to fill a skilled operator with higher pay, better hours, and better benefits. No one is even willing to accept a promotion.” –Agriculture, IL

Inflation:

“Farming is in a pinch right now with the high prices of our inputs fertilizer, fuel, chemicals, and taxes).” – Agriculture, IN

“Labor, fuel, and insurance have all gone up. [We are] having a hard time raising rates to keep up with the cost of doing business.” – Transportation, CA

“We have a trucking company and a grain farm. The cost of fuel alone is killing us. Fertilizer for the farm is out of this world. Something has to give soon or we’re going to be the ones giving up everything.” –
Transportation, PA

“In farming we are experiencing very high input costs coupled with low commodity prices which have impacted our margins! Farm equipment prices have increased by over 300% in the past 15 years, making it
almost impossible to purchase new equipment. The farmer suffers while we purchase our supplies/equipment from monopolies that are making record profits. Those companies that purchase our commodities have become monopolies as well!” – Agriculture, TX

“Worried about the economy due to inflation. Our guests do not have the disposable income they had a few years ago. […]” – Services, OH

“Most businesses can at least pass on increases for products. Agriculture saw huge increases in fuel and fertilizer costs. Our commodities are mainly priced by the Chicago Board of Trade, and I have no way of
passing on these increased expenses, leaving myself and the larger agriculture community with the very real possibility of negative margins on our 2026 crops.” – Agriculture, PA

“The costs of materials and employees are up.” – Construction, UT

“Inflation is an issue – not sure how much inventory to order. Taxes force business to make out-of-ordinary decisions. Inflation is a detriment to employees – can’t pay them enough nowadays and getting harder to pass expenses along. Economy appears strong on Wall Street but weak on Main Street.” – Retail, IL

“The cost of interest, insurance, power (gas/electric), supplies, and vehicle gas is drowning my business. Small businesses need help!” – Services, MI

“The marine industry has doubled standard inflation. Over the past seven years, with many OEMs adding another 5-7% for the 2027 model year. We are pricing ourselves out of the market with the other economic pressures (high interest rates and debt, high grocery prices, high fuel prices, etc.).” – Retail, OR

“Unfortunately, the cost to operate has almost reached the point that we cannot make a profit because labor and parts markup cannot keep up with the expenses of all insurances, taxes, overhead, payroll, truck payment, and shop payment.” – Services, AL

“The economy seems to be in a weird, uncertain place currently. People are spending, but wages are moving slow.” – Construction, IL

“The inflation caused by tariffs has significantly affected our business. Our customer accounts are struggling to pay their invoices, which amounts to approximately 20-30% of our gross profit.” – Retail, TN

Business Conditions:

“Our business has been slow the past two years due to inflation of gas, oil, and groceries. And people are choosing not to repair their swimming pools, which is not considered a priority, or having their iron gates
and fences built.” – Services, AR

“Overall business has been steady and very busy.” – Manufacturing, OH

“The economy is killing us. Work is slow.” – Transportation, OH

“There is a noticeable shift in customers’ behavior – much more price sensitive and questioning all invoices. Many of our large customers have moved out of the area or gone out of business. This leaves fewer customers for us and our competitors to service (we are a regional B2B provider). There is not enough business for us all, so we are working hard to keep or gain as much as we can.” – Wholesale, NY

“Insurance premiums, fuel and utilities, and a lack of skilled labor are having a negative impact on our business.” – Services, OH

“The economy is affecting our bottom line. The trend in healthcare, with insurers paying for less and putting more burden on consumers, is the biggest problem facing all healthcare providers.” – Professional/business services, VA

“Business is fairly robust in our area. The large majority of our clients (small businesses) are profitable.” – Professional/business services, GA

“The economy has definitely slowed business. If it’s a question of filling up your car with gas to go to work, putting food on the table, or buying a new appliance just because you want a change in your kitchen, I think we all know which is coming in last. Appliances are replaced when they break down and then mostly from the least expensive place (big-box stores).” – Retail, IL

“Our business is down 15.5% year to date from last year and 28% down from our 5-year average. Rising costs of materials and freight have made us go up in our pricing. Competition is tough as everyone is
willing to go down on their margins to get customers. Our walk-in traffic has diminished tremendously. Our expenses have skyrocketed, and insurance and health insurance are now unaffordable.” – Retail, TX

“Things are slow but the same! Clients are passing away or thinking they can do our job themselves. But they always come back because they realize they can’t or they get in trouble with the different agencies for doing the paperwork or reports wrong. It’s a cycle!” – Professional/business services, AZ

“Business is good, but state regulations are making it harder. Also, the prices of goods are out of reach for most of our customers.” – Construction, NY

Sales:

“I have found it harder to increase sales above what we have. Although we have grossed more year to date, we are basically operating at a zero-profit margin. Overall the cost of everything has increased, in response we raised our prices – but are just breaking even.” – Services, CA

“The internet (do-it-yourself videos) has impacted my bottom line.” – Services, OH

“Retail sales numbers continue to decline. Customer count is down as more people are purchasing online and not visiting brick-and-mortar stores. Landscape division numbers are down. Customers have less money to spend due to inflation; customer confidence is down.” – Retail, IA

Insurance:

“Our insurance costs have been a burden for several years. Increasing at a rate we can barely keep up with – most notably auto. And windstorms are also a concern. I believe the whole Texas costs (including Houston) should all share this expense, as this whole area is impacted by hurricanes.” – Manufacturing, TX

“Health insurance out of control.” – Professional/business services, OH
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CREDIT MARKETS

In July, the net percent of owners expecting easier credit conditions rose 1 point to a net -4% (seasonally adjusted). A net 5% reported their last loan was harder to get than in previous attempts, up 2 points from June. In July, a net 4% of owners reported paying a higher interest rate on their most recent loan, down 1 point from June. The average interest rate paid on short-maturity loans was 7.9% in July, up 0.5 point from June’s lowest level since October 2022. Twenty-seven percent of all owners reported borrowing regularly, up 5 points from June, but remaining below the historical average of 34%.

INFLATION

Though still high, the inflation metrics showed substantial improvement in July. The net percent of owners raising average selling prices fell 7 points from June to a net 31% (seasonally adjusted), after four consecutive months of increases. Actual price increases are well above the historical average of net 14%. Unadjusted, 40% reported higher average prices (down 7 points), and 8% reported lower average selling prices (up 1 point). As actual price increases decreased in July, so did the share of owners planning to raise prices in the near future. Looking forward to the next three months, a net 28% (seasonally adjusted) plan to increase prices, down 4 points from June. Reports of inflation as the single most important problem fell for the first time this year. Fourteen percent of business owners cited inflation as their single most important business problem, down 7 points from June’s highest reading since October 2024. Inflation now ranks as the third top problem..."