Small‑business sentiment slips

U.S. small-business optimism fell in March to its lowest level since April 2025, as higher oil prices and weaker profit reports dragged sentiment down. (nfib.com) The National Federation of Independent Business said its Small Business Optimism Index dropped 3.0 points to 95.8 in March from 98.8 in February, slipping below the survey’s 52-year average of 98.0. Its Uncertainty Index rose 4 points to 92, far above the historical average of 68. (nfib.com) Reuters reported the March drop came as a jump in oil prices tied to the Iran war outweighed tax relief for some owners. The 95.8 reading was the lowest in 11 months. (reuters.com) The survey’s weakest pieces were profits and expectations. The share of owners reporting positive profit trends fell 11 points to a net negative 25%, and the share expecting better business conditions fell 7 points to a net 11%, the lowest since October 2024. (nfib.com) Hiring and investment plans also softened. The employment index fell to 101.6 from 103.5, only 16% of owners said they planned capital outlays in the next six months, and that investment reading was the lowest since November 2009. (nfib.com) The tax piece in the survey reflects a law signed on July 4, 2025, that made the 20% small-business deduction permanent and expanded other breaks for some firms. The Small Business Administration says the law has already reduced taxes for more than 12 million small-business owners by about $7,000 on average. (sba.gov) That tax relief did not erase the pressure from energy and supply costs in March. National Federation of Independent Business Chief Economist Bill Dunkelberg said the oil-price spike “spooked consumers and owners alike,” while 62% of owners said supply-chain disruptions affected their business to some extent, up 3 points from February. (nfib.com) The March survey landed as households were turning gloomier too. The University of Michigan said its preliminary consumer sentiment index fell to 47.6 in April from 53.3 in March, with respondents citing high prices, weaker asset values and the Iran conflict. (sca.isr.umich.edu) The two surveys together point to the same problem in early spring: higher fuel costs were hitting both shoppers and the businesses that sell to them. For small firms, that showed up in thinner profits, weaker sales reports and less appetite to hire or invest. (nfib.com; sca.isr.umich.edu)