Small-business optimism falls to 95.8 in March

The National Federation of Independent Business reported the Small Business Optimism Index fell to 95.8 in March, a 3.0-point decline from February’s 98.8 and below the index’s 52-year average of 98.0. The reading comes from the NFIB’s monthly survey of small-business owners across the United States.

The NFIB’s Uncertainty Index rose four points to 92, well above its long-run average of 68. The survey covers owner expectations for real sales, hiring plans and capital spending.

The federation attributed the drop in optimism and the rise in uncertainty to a sharp increase in oil prices and heightened tensions between the U.S. and Iran, which the group said have reduced consumer confidence and dampened business sentiment.

The NFIB noted recent tax changes have provided relief for some firms, including the 20% Small Business Deduction included in the Working Families Tax Cut Act, but added that higher energy costs are creating new pressure on owners.

Bill Dunkelberg, the NFIB’s chief economist, said, “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. 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.”

According to NFIB data, the March reading is the first time the index has fallen below its 52-year average since April 2025. The federation described the decline as widely expected and said the report was not market-moving.