Peace Garden News

The National Federation of Independent Business (NFIB) reported that its Small Business Optimism Index fell by 0.6 points in October to 98.2, though it remains above the index’s 52-year average of 98. The Uncertainty Index dropped by 12 points from September, reaching its lowest level this year at 88.

“Optimism among small businesses declined slightly in October as owners report lower sales and reduced profits,” said NFIB Chief Economist Bill Dunkelberg. “Additionally, many firms are still navigating a labor shortage and want to hire but are having difficulty doing so, with labor quality being the top issue for Main Street.”

Don Larson, NFIB North Dakota State Director, noted the particular challenges facing local industries: “North Dakota’s oil and gas and agricultural service industries are feeling the burn of significant nationwide workforce shortages. Small business owners are also reporting a decline in earnings. Even though the Legislature will not meet next year, small business owners should share their experiences with lawmakers to ensure pro-small business legislation is prioritized during the next session.”

The NFIB has also introduced a new podcast called “Small Business by the Numbers.” Hosted by Holly Wade, Executive Director of the NFIB Research Center, it aims to discuss data and conditions affecting small businesses across the country.

According to survey results from October:

- Thirty-two percent of owners reported job openings they could not fill; this rate has remained steady since September.

- Labor quality was cited as the most pressing problem by 27% of respondents, up nine points from September.

- A net negative 13% reported higher nominal sales over the past three months compared to previous periods.

- Reports of positive profit trends decreased sharply; a net negative 25% was recorded for this metric.

- Both actual and planned price increases declined slightly from September levels.

- Sixty percent experienced supply chain disruptions impacting their operations—a decrease from earlier months.

- The net percentage expecting better business conditions dropped three points but remains above historical averages.

The monthly jobs report indicated that among those trying to hire in October—56%—a majority found few or no qualified applicants. Plans for job creation have dipped slightly after several months of growth.

Labor costs as a top concern fell modestly; eight percent now cite them as their primary challenge. Compensation increases have slowed both in recent actions and future plans.

Capital expenditures saw little change: more than half made outlays in recent months, primarily on equipment or vehicles. Fewer expect inventory gains moving forward.

Inflation concerns remain but have lessened somewhat; only twelve percent named it their biggest problem, down two points from September. Poor sales persist as an ongoing issue for ten percent.

Loan access appears to be easing slightly: five percent found loans harder to obtain than before—a reduction compared to prior readings—and fewer paid higher interest rates on recent borrowing.

Business health assessments shifted downward: while twelve percent described their status as excellent (a slight increase), fifty-one percent said good (down six points), thirty-three percent rated fair (up six points), and four percent called it poor.

Finally, just thirteen percent said it is currently a good time to expand—still considered weak compared with typical expansionary periods.

NFIB’s Small Business Economic Trends data comes from randomly selected members surveyed monthly since 1986; October’s survey underpins these findings.