BOSTON Small business optimism improved modestly in November, according to new data released today by the National Federation of Independent Business (NFIB). The organization’s Small Business Optimism Index rose 0.8 points to 99.0, remaining above its 52-year average of 98. The bump was driven largely by more owners expecting higher real sales in the coming months, though rising uncertainty and persistent labor challenges continue to weigh on Main Street.
Of the index’s 10 components, six increased, three declined, and one was unchanged. The Uncertainty Index climbed 3 points to 91, reflecting more owners unsure about capital spending over the next three to six months.
“Small business growth continues to be hampered by the inability to find qualified workers and fill open positions,” said Christopher Carlozzi, NFIB’s Massachusetts State Director. “When Massachusetts lawmakers reconvene in January, they should be laser-focused on policies that make it easier to create and maintain jobs.”
Labor Quality Still the Top Problem
Labor quality remained the most frequently cited issue, with 21% of owners naming it their single biggest challenge—down 6 points from October but still the top concern. According to the report:
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33% of small business owners had job openings they could not fill, the first increase since June.
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Among owners hiring or trying to hire, 89% reported “few or no qualified applicants.”
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A seasonally adjusted net 19% plan to create jobs over the next three months, the highest reading of 2025.
Inflation ranked second among top concerns, cited by 15% of owners, followed by taxes (14%) and government regulations/red tape (10%).
Pricing Pressure Intensifies
Inflationary pressure reemerged sharply in November. The net share of owners raising average selling prices jumped 13 points to 34%, the highest level since March 2023 and the largest single-month increase in the survey’s history. Price hikes remain well above the long-term average of 13%.
Looking ahead, a net 30% plan to raise prices in the next three months.
Compensation pressures also continued: a net 26% of owners raised wages, while 24% plan increases in the near term.
Sales Expectations Improve Despite Weak Recent Activity
While recent business performance was mixed, owners were more optimistic about future sales:
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A net -9% reported higher nominal sales over the past three months, though this was a 4-point improvement from October.
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Expectations for higher real sales volumes surged 9 points to a net 15%, the strongest contributor to November’s optimism increase.
Supply Chain Disruptions Rise Again
Supply chain issues remain stubborn. 64% of small businesses reported disruptions in November, up 4 points from October. Seven percent experienced significant impacts, while only 35% reported no disruptions.
Financing Conditions Ease Slightly
Borrowing conditions softened somewhat:
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The average interest rate on short-term loans fell to 7.9%, down 0.8 points and the lowest since May 2023.
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A net 4% said their latest loan was harder to obtain, down slightly from October.
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Regular borrowing remained unchanged at 23%, historically low.
Business Health and Confidence
Owners’ assessments of their own business conditions showed modest improvement:
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11% reported excellent business health,
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53% said good,
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30% fair,
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5% poor.
However, broader economic expectations continue to erode. The net share of owners expecting better overall business conditions fell 5 points to 15%, down 32 points since January.
Only 13% said it is currently a good time to expand—unchanged from October and low by historical expansion-era standards.
Capital Spending Slows
Just over half of owners (52%) made capital outlays in the past six months, down 3 points. Spending trends included:
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37% on new equipment
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19% on vehicles
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14% on facility improvements
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10% on fixtures and furniture
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5% on land or buildings.
