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The National Federation of Independent Business (NFIB) released its latest Small Business Optimism Index for January, showing a slight dip of 0.2 points to 99.3—still comfortably above the 52-year historical average of 98. The report, based on surveys of NFIB members, highlights a resilient small business sector that anticipates stronger sales even as persistent inflation, labor challenges, and policy uncertainty continue to weigh on owners’ minds.

 The NFIB Small Business Optimism Index fell marginally to 99.3 in January from 99.5 in December, according to the organization’s monthly Small Business Economic Trends survey. While three of the 10 index components rose, seven declined, with the most notable positive shift coming in expected real sales volume, which jumped 6 points to a net 16%. This marks a significant improvement in owners’ outlook for business performance despite broader economic headwinds.

 “While GDP is rising, small businesses are still waiting for noticeable economic growth. Despite this, more owners are reporting better business health and anticipating higher sales,” said NFIB Chief Economist Bill Dunkelberg in the release. The Uncertainty Index climbed 7 points to 91, driven primarily by increased hesitation among owners about whether now is a good time to expand.

 Labor quality remains a top concern, with 16% of owners citing it as their single most important problem (down 3 points from December), while insurance costs or availability rose to 13%—the highest level since December 2018. Capital outlays also showed strength, with 60% of owners reporting investments in the last six months, up 4 points and the highest since November 2023.

 In a complementary report released the same day, marketing platform Constant Contact shared findings from its Q1 2026 Small Business Now survey of over 1,500 small business owners across the U.S., Canada, the U.K., Australia, and New Zealand. The study revealed that 41% of U.S. small business owners named inflation as their top concern—far outpacing weak customer spending at 19%. In response, a striking 74% expect to dedicate more time to marketing efforts in 2026, and 68% plan to increase their marketing budgets to combat rising costs and drive growth.

 “Small businesses are doubling down on marketing to navigate economic uncertainty,” the report noted, emphasizing a shift toward more efficient operations and maximizing every dollar spent.

 On the legislative front, the House Committee on Small Business favorably reported three bills on February 11 aimed at enhancing SBA accountability and fraud prevention under the current administration’s priorities. These include the Small Business Lending Fraud Prevention Act (H.R. 7401), the Native American Entrepreneurial Opportunity Act (H.R. 7396), and the Put America on Commission Act of 2026 (H.R. 7412), which would establish whistleblower incentives for reporting pandemic-era loan fraud.

 The NFIB’s data aligns with broader trends of cautious optimism among small business leaders heading into 2026, as highlighted in recent surveys from JPMorgan Chase showing rising confidence in company-specific prospects despite mixed national outlooks.

 “The National Federation of Independent Business’s Optimism Index measures about 500-600 usable responses from 5,000 of their members that are sampled each month, according to perplexity.ai. Is that the optimism of 36 million small businesses? Maybe. 

 “Without question, the greatest bill the House Committee on Small Business could report would stop the diversion of small business contracts to big businesses. That’s the number one problem in federal contracting. Small businesses would create millions of new jobs (big businesses don’t, they don’t have to, they’re already big), and the economy would boom if only small businesses got small business contracts. The committee Chairperson or SBA administrator who solves this problem will go down in history as a hero,” said Bruce de Torres, Director of Communications for the American Small Business League.

 As small businesses navigate inflation, labor shortages, and evolving federal policies, these indicators suggest a sector poised for measured growth while remaining vigilant about economic pressures.

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Rick Amato

Rick Amato, is a former financial adviser for Merrill Lynch and founded the Amato Wealth Management Group. He is currently the host of Politics And Profits with Rick Amato, which airs in 30 million homes across America on EANTV on Roku. Find out more at amatotalk.com.

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