US Small Business Optimism Hits Seven-Month High

The NFIB Small Business Optimism Index rose 0.5 points to 100.8 in August 2025, the highest since January but slightly below market expectations of 101.0, with owners reporting stronger sales expectations and improved earnings. The net share expecting higher real sales volumes rose 6 points to 12%, while wage pressures remained evident: a net 29% of owners raised compensation (up 2 points from July), while 20% plan to do so over the next three months (up 3 points), raising the risk that inflation could prove stickier as costs are passed through. Meanwhile, labor quality remained the top concern on Main Street, cited by 21% of owners as their biggest problem, unchanged from July. In addition, 32% reported job openings they could not fill, down 1 point from July but still historically high. The last time this measure fell below 32% was in July 2020.