The National Federation of Independent Business's monthly Small Business Optimism Index fell to a reading of 95.3 in May from 95.9 in April and was well below a 98.8 reading a year earlier.
"AI investment spending has contributed to some excitement in the economy," said NFIB Chief Economist Bill Dunkelberg. "Despite the enthusiasm around AI, the overall picture is divided. More small business owners are struggling with significant and unpredictable hikes in fuel prices, which are more challenging for small businesses to pass on to their customers compared to their larger corporate competitors."
There were monthly decreases in six of the 10 component measures, compared with three increases and one unchanged reading.
The measure of current jobs opening fell by five percentage points to a net of 29%, indicating slower expansion. Likewise, plans to increase employment fell by four percentage points to 9%.
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 decreases in the measures of current inventories (to a net minus 4%), sales expectations (to a net 1%), economic expectations (to a net 3%) and capital outlays plans (to a net 16%).
There were gains in the readings for the earnings trend (to a net minus 15%), plans to increase inventories (to a net 1%), and expected credit conditions (to a net minus 3%).
The reading for expansion plans was unchanged at a net 7%.