Source: Economics Group of Wells Fargo Bank, N.A.
Summary
Small Firms Optimistic Despite Policy Volatility
The NFIB Small Business Optimism Index picked up in July on brighter expectations for the economy. At the same time, the uncertainty index surged ahead of the August 1 tariff deadline, indicating that the volatile tariff landscape may be disrupting small business decision-making. Inflationary pressures are not yet evident in small business pricing decisions. However, capital expenditures remain suppressed alongside elevated uncertainty and the labor market appears to be loosening on trend. The prevalence of unfilled job openings dropped sharply in July, but weak labor supply remains a challenge for firms with high exposure to immigration shifts.