The National Federation of Independent Business's monthly Small Business Optimism Index fell to a reading of 95.8 in March from 98.8 in February and 97.4 in March 2025, hitting its lowest point since April 2025.
"The 20% Small Business Deduction and other supportive small business tax provisions in the Working Families Tax Cut Act have had many positives for small business owners," said NFIB Chief Economist Bill Dunkelberg. "However, the dramatic spike in oil prices has spooked consumers and owners alike. Small business owners are having to absorb those higher input costs and pass them along to their customers."
There were monthly decreases in eight of the 10 component measures, with no change in the other two measures.
The earnings trend posted the largest decrease, falling by 11 percentage points to a net minus 25% while economic expectations fell by seven percentage points to a net 11%.
A net positive reading indicates that more respondents expect an increase than those expecting a decrease, and vice versa for a net negative reading.
There were also small declines in the readings for expansion plans (to a net 11%), current inventories (to a net minus 5%), inventory growth plans (to a net minus 5%), capital outlay plans (to a net 16%), sales expectations (to a net 7%) and current job openings (to a net 32%).
There was no change in the readings for employment plans (at a net 12%) and expected credit conditions (to a net minus 5%).