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. Designed by Magnific

SACRAMENTO REGION, CA (MPG) – From John Kabateck, state director for the National Federation of Independent Business (NFIB) in California, on the April 14 release of the NFIB Small Business Optimism Index showing it fell 3.0 points in March to 95.8, leaving it below its 52-year average of 98.0. The last time the Optimism Index fell below its historical average was April 2025. The Uncertainty Index rose 4 points from February to 92, well above its historical average of 68.

“Sporadic dips in the indexes that measure economies are natural. What matters most is having the right state and federal policies in place that allow everyone to weather them long enough for them to rebound. That’s why it was so supremely important that Congress not let the 20% Small Business Tax Deduction expire at the end of last year, which it didn’t, and then it took the extra step by making it permanent. Now, only if the California Legislature could resist its worst tax and regulatory impulses and be as helpful.”

From NFIB Chief Economist Bill Dunkelberg

“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.”

Highlights from the Latest NFIB Small Business Optimism Index

The frequency of reports of positive profit trends fell 11 points from February to a net negative 25% (seasonally adjusted), contributing the most to the Optimism Index’s decline.

The net percent of owners expecting better business conditions fell 7 points from February to a net 11% (seasonally adjusted), the third consecutive monthly decline and the lowest level since October 2024. This was the second biggest contributor to the Index’s decline.

In March, both planned and actual labor compensation decreased from the previous month. A seasonally adjusted net 33% reported raising compensation, down 1 point from February. A seasonally adjusted net 18% plan to raise compensation in the next three months, down 4 points from February and the lowest reading since July 2025.

Sixteen percent (seasonally adjusted) of small business owners plan to make capital outlays in the next six months, down 2 points from February and the lowest level since November 2009.

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