WASHINGTON, D.C. (May 27, 2025) – The NFIB Research Center released an industry-specific quarterly Small Business Economic Trends survey highlighting the construction, manufacturing, retail, and services industries. According to the report, the Optimism Index across the four reported industries decreased from the previous quarter. Despite this decline, optimism in the construction, manufacturing, and services industries was higher than that of the overall business community in April. In fact, the indices for each sector, excluding retail, remain above the overall Optimism Index 51-year average of 98. Optimism among small retailers landed significantly lower than the other three highlighted industries.

“Small business optimism declined in all four industry sectors, but most notably among small retailers and manufacturers largely due to more pessimistic views about future business conditions, supply chain disruptions, and ongoing labor quality concerns,” said Holly Wade, Executive Director of NFIB’s Research Center. “Despite the declines in Optimism as owners navigate the evolving business climate, at least 60 percent of small firms across all industries consider their business in excellent or good health.”

The survey was conducted in April and the overall Optimism Index in April was 95.8.

Key findings by industry include:

Construction

• In April, the Optimism Index for the construction industry was 100.9, down 3.9 points from January, the smallest change of all reported industries. Owners in the construction industry were the most optimistic of the four sectors, with an Index reading of 5.1 points higher than that for all firms.
• Over half (55%, seasonally adjusted) of small businesses in the construction industry reported unfilled job openings, the highest of all industries and 21 points higher than for all firms. Construction was the only industry with an increased level of unfilled job openings from the previous quarter.
• Fifty-six percent of construction firms reported few or no qualified applicants for their open positions, up five points from the previous quarter, and nearly a third reported labor quality as their single most important problem.
• A seasonally adjusted net 20% of small businesses in the construction industry plan to hire in the next three months, down 12 points from January but seven points higher than the reading for all firms. This reading is the second highest among the four industries, just behind manufacturing.

Manufacturing

• The Optimism Index for the manufacturing industry was 6 in April, down 6.8 points from January, but still higher than that of the overall small business community and above the overall 51-year average of 98. This was the largest change from the prior quarter for all industries.
• Earnings trends in the manufacturing industry improved 21 points from January to a seasonally adjusted net negative 10%, the best reading among all industries.
• The percent of manufacturing firms expecting real sales to improve fell 12 points from January to a net 9% (seasonally adjusted), ten points better than the reading for all firms and the greatest among the four industries.
• In April, a net 15% (seasonally adjusted) of small business owners in the manufacturing industry expect the economy to improve. This was 42 points lower than in January and was the largest quarterly decline across all industries.

Retail

• The Optimism Index for the retail sector fell 6.4 points from January to 93.7. This sector exhibited the lowest level of optimism among the four reported industries and the only industry with an Optimism Index lower than that of the overall small business community. Expectations for better business conditions and real sales expectations were the largest contributors to the decline, a reversal from the previous quarter.
• The retail industry had the lowest percent of small businesses with hiring plans (net 10% seasonally adjusted), three points below the reading for all firms, and the lowest of all industries. Retail was the only reporting industry with hiring levels below the overall reading.
• In April, a net negative 14% (seasonally adjusted) of retailers reported current inventory levels as “too low”, down six points from January and eight points lower than the aggregate reading of all firms. This was the worst reading of all industries. Plans to increase inventory declined seven points from last quarter to a net negative 4% (seasonally adjusted), matching the reading for all firms combined.
• The percent of small firms in the retail industry expecting strong future sales fell 11 points from January to a net 7% (seasonally adjusted). Despite the decline, sales expectations for the retail industry were eight points higher than those of the overall small business community.

Services

• In April, the Optimism Index for the services industry was 98.6, down 4.5 points from January. This decline was mostly due to a weakening in the outlook for general business conditions.
• A net 23% (seasonally adjusted) of owners in the services industry reported they expect the economy to improve. Although this reading is 25 points worse than in January, it was the highest of all industries and eight points above that of all firms combined.
• A seasonally adjusted net 17% of small firms in the services sector reported hiring plans in April, up two points from January and higher than the reading of net 13% (seasonally adjusted) for all firms combined. The services industry was the only sector in which hiring plans rose from the previous quarter.
• Plans to make capital expenditures in the coming months were the lowest in the services industry at a net 15% (seasonally adjusted), compared to the overall reading of a net 18% (seasonally adjusted).

The full report is available here.

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