U.S. Small-Business Optimism Slips in September as Inflation Concerns Resurface

Washington, D.C., October 14, 2025 — U.S. small businesses grew more cautious in September, according to the National Federation of Independent Business (NFIB). The NFIB’s Small Business Optimism Index declined by 2.0 points to 98.8, marking its first drop in three months.

Rising Uncertainty and Policy Impacts

Heightened uncertainty accompanied the decline. The NFIB’s Uncertainty Index climbed by 7 points, reaching 100 — one of its highest readings in over five decades. Many business owners cited ongoing policy debates, shifting tariffs, and broader economic ambiguity as key sources of concern. As NFIB Chief Economist Bill Dunkelberg noted, “policy changes still in the air” contribute to the uneasy outlook.

Complicating matters, a partial U.S. government shutdown has delayed the release of official economic data, forcing investors and analysts to lean on private surveys for signals about the economy’s state. The delay includes the September employment report; however, consumer price index (CPI) data is still expected next week — data that could influence Social Security cost-of-living adjustments for 2026.

Inflation, Tariffs, and Stretched Margins

One in seven business owners (14 %) flagged inflation as their top operational challenge, up three points from August. Meanwhile, the share of firms raising prices rose to 24 %, above the long-term monthly average of 13 %.

Tariffs continue to strain small business finances. Many respondents pointed to higher costs tied to beef, health insurance, taxes and imported goods. Some also cited supply chain disruptions. With President Trump threatening additional import duties — including a proposed 100 % tariff on Chinese goods — input cost pressures that already exist may intensify further.

Roughly 31 % of firms plan to raise prices over the next three months — five points higher than in August. Yet expectations for inflation-adjusted sales slipped, increasing the risk of unsold inventory accumulating.

Glimmers Below the Surface

Despite the pessimism, some resilience remains in consumer spending. This strength seems concentrated among higher-income households, and gains in the stock market continue to fuel capital income for shareholders. As a result, economic momentum may rely less on Main Street demand and more on asset-driven wealth effects.