Buckeye Reporter

The National Federation of Independent Business (NFIB) released its Small Business Optimism Index for June, showing a slight decrease of 0.2 points to 98.6, which remains above the long-term average of 98. The decline is largely attributed to an increase in businesses reporting excess inventories. Meanwhile, the Uncertainty Index dropped by five points to 89.

Cameron Garczyk, NFIB Ohio Assistant State Director, commented on the situation in Ohio: “Small businesses throughout Ohio continue to struggle with various economic challenges, including costly taxes and hiring qualified workers. Thankfully, we’re also seeing inflationary pressures continue to rapidly decline."

Key findings from the report include changes in inventory levels and expectations for business conditions and sales volumes. A net negative 5% of owners found current inventory stocks "too low," marking a shift towards increased inventories. Expectations for better business conditions fell three points but remain historically positive at a net 22%.

Issues such as labor quality remained unchanged as a significant problem for businesses at 16%. Inflation concerns have eased with only 11% citing it as their main issue, down from May figures.

The survey indicated that job openings were hard to fill for many small business owners, with a seasonally adjusted net of 13% planning to create new jobs soon.

Labor costs were reported as a growing concern by 10% of respondents while compensation increases were noted by a net 33%, marking the largest monthly rise since January 2020.

Capital expenditures showed a decrease with only half of the surveyed owners making outlays in recent months—a drop from previous reports—and poor sales rose slightly as a top problem among business owners.

Price adjustments are planned by some businesses with seasonally adjusted numbers showing an increase in both planned price hikes and actual selling price raises.

Profit trends improved slightly despite ongoing challenges related to weaker sales and rising material costs.

Lastly, taxes remain the primary concern for small business owners at 19%, matching levels last seen in July 2021. Financing difficulties seem less pronounced with only minor increases reported in borrowing rates and loan accessibility issues.

The NFIB's monthly survey collects data on small business economic trends across various sectors and has been conducted consistently since its inception several decades ago.