forecasting
freightcast
While Wall Street reacts to trade headlines and inflation data, Main Street is sending a quieter but more concerning signal. Small business sentiment continues to slide, reflecting growing unease about economic conditions, policy direction, and consumer demand.
Confidence Below Historical Norms
The National Federation of Independent Business (NFIB) Small Business Optimism Index fell 1.6 points in April to 95.8—well below its 50-year average. This latest reading reflects a broad-based deterioration in outlook among small business owners and is yet another indication that uncertainty is taking a toll across sectors.
If you missed our complimentary State of Freight Economic Outlook webinar, you can catch the replay here. Economist Bill Witte and FTR experts Avery Vise and Jonathan Starks decode the latest economic signals and what they mean for freight. In a time of uncertainty, this is the clarity your business needs. WATCH THE REPLAY!!!
📉Hiring & Investment Hit New Lows
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34% of small firms report unfilled jobs — lowest in 3 years
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18% plan to boost CapEx — weakest since April 2020
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Signals deeper pullback in confidence, not just caution
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Uncertainty around trade and rates is stalling growth plans
Inflation Isn't the Top Concern—But It Still Lurks
Interestingly, fewer small firms now cite inflation as their primary concern. Just 14% listed it as the top issue, and the share of firms planning to raise prices or increase compensation has fallen to multi-year lows. This aligns with broader macro trends showing a softening in service-sector inflation—but the relief may be temporary.
If tariff-related price increases accelerate in the coming months, especially in goods sectors, small businesses could once again face margin pressures without the pricing power to respond.
The Broader Implication
Small businesses are often considered the backbone of the U.S. economy—and an early warning system. When they pull back on hiring and capital spending, it tends to ripple outward. Slower job growth, softer demand for equipment and supplies, and more conservative local investment can amplify broader economic slowdowns.
Final Thought: Watch the Small Players
Big business may dominate headlines, but the real story of economic health is often told through the lens of small firms. With sentiment slipping, hiring plans fading, and investments on hold, small businesses are signaling caution. Whether this is a temporary pause or the early signs of a broader downshift will depend on what happens next in policy, inflation, and consumer confidence.
