Labor Shortages Depressing Small Business Owners

Today, the National Federation of Independent Business (NFIB) released its September survey of small business owners. They are about as depressed as they have ever been. That’s not because their sales are terrible. Rather, they can’t find enough workers to expand their businesses. So they’ve had to raise both the wages they pay and the prices they charge. However, September’s survey suggested that inflationary pressures are moderating. Consider the following:

(1) Depressed outlook. The NFIB index of the outlook for general business fell to a record low of -61 during June. It was back up to -44 during September, which was still well below the previous troughs in this series that started in 1974. Inflation is the number one problem faced by 30% of small business owners, according to the latest survey. It peaked at 37% during July, but these readings are in line with similar ones during the Great Inflation of the 1970s.