NFIB Reports Small Business Optimism Slips

November 5, 2025 |By Kelly Hite

NEW ORLEANS – The National Federation of Independent Business (NFIB) Small Business Optimism Index dropped two points in Sept. to 98.8, just slightly above the 52-year average of 98, an indication that small business owners across the country are feeling more cautious. Optimism among small business owners declined for the first time in three months,

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“Pressures from inflation, lower expected sales, and concerns about the broader economy were the biggest contributors to the index’s decline,” the report said.

Although the index is still marginally higher than its 52-year average, NFIB said uncertainty among small business owners “rose sharply, climbing seven points to its fourth highest level in more than five decades.” The report noted that labor quality and taxes were tied as the most frequently cited challenges, each at 18%.

Local marketing experts say that while small business owners face an uncertain economy, they can still promote sales through proactive planning and brand strategy. “Plan early and strategically; it’s the secret to standing out,” said Tamar Meguerditchian Gregorian, program director and senior professor of practice for the Media and Design program at Tulane University’s School of Professional Advancement, during Biz Talks episode 262: What Should Entrepreneurs Be Doing Now to Prepare for Small Businesses Saturday?

Inflation and Supply Chain Pressures Mount

Among the report’s key findings, NFIB said that “increasing supply chain and inflation issues are perhaps the top finding of this report.” A net 24% of business owners reported raising average selling prices in September, up from August, while a net 31% plan to increase prices over the next three months.

Supply chain problems are also worsening. “In September, 64% of small business owners reported supply chain disruptions affected their business to some degree,” the report found — a 10-point jump from the previous month. Inventory concerns grew as well, with a net negative 7% of owners saying their current stock was too low, the largest monthly decline in the survey’s history.

Local marketers say this environment highlights the importance of digital visibility. “Look at online resources, especially at this time of discoverability,” said Will Monson, who serves on the board for the American Marketing Association New Orleans Chapter and is the email strategist at M.S. Rau, a fine art and antiques gallery in New Orleans. “What comes up when you Google your business name? Give people the information they need. Go through your website and update your content for keywords. This helps so much with little effort.”

Earnings Improve but Hiring Stays Tough

Even with rising costs, NFIB data show that actual earnings improved modestly. The net percentage of owners reporting higher profits rose three points in September to its best level since December 2021. However, labor challenges continue to limit growth.

“Labor quality as small business owners’ top issue fell 3% in September to 18%, which is now tied with taxes as the single most important problem,” the report said. Roughly one-third of respondents — 32% — reported jobs they could not fill. Of the 58% of businesses either hiring or trying to hire, 88% said they found “few to no qualified applicants” for open positions.

Gregorian said that as competition for both talent and customers intensifies, small businesses should focus on storytelling to stand out. “Emphasize storytelling over selling,” she said. “Tell your audience why your business is unique and what makes your business stand out. Is it your founder story? Are you family-owned? Do you give back to the local community? Really work to humanize your brand.”

Louisiana Outlook

NFIB Louisiana has repeatedly cited inflation, taxes, and workforce shortages as the most pressing issues for small business owners in the state, echoing national trends seen in the September report.

Louisiana’s small business community represents a major share of the state’s employment base, accounting for more than 99.5% of all businesses and over half of all private-sector jobs (53%), according to the U.S. Small Business Administration.

As businesses look for ways to maintain visibility in a competitive marketplace, Monson said strategic social media use can make a difference. “With regard to social media, know when your customers are interacting,” he said. “Knowing which days people are more likely to engage with content and then building a plan around that is very effective.”

Recent changes to major online platforms, including Google’s rollout of AI Overviews and AI Mode, have led to higher impressions (the number of times content appears in search results) but fewer clicks, sharply reducing referral traffic.

As a result, many companies are adopting a more diversified approach including paid advertising through Meta. The key, experts say, is to keep optimizing for search while developing multiple reliable channels, testing constantly and staying adaptable as algorithms and AI continue to reshape the rules of digital growth.