Inflation digging in deeper as No. 1 problem for many Main Street entrepreneurs
DENVER, Feb. 8, 2022—One huge problem for small business is triggering another in a big way, according to today’s release of the latest bellwether measurement of the nation’s Main Street economy, which shows inflation now a major concern for many small-business owners.
The Small Business Economic Trends report (aka the Optimism Index), released monthly by the National Federation of Independent Business (NFIB), America’s largest small-business association, found 22% of small-business owners reporting inflation as their single most important business problem, unchanged from December when it reached the highest level since 1981. The net percent of owners raising average selling prices increased four points to a net 61% (seasonally adjusted), the highest reading since the fourth quarter of 1974.
“Supply chain disruptions are affecting practically every industry known to man,” said Tony Gagliardi, Colorado state director for NFIB. “This disruption is partially responsible for increased consumer prices. Small businesses can no longer absorb increased wholesale prices. Those prices must now be passed along.”
From NFIB Chief Economist Bill Dunkelberg
“More small business owners started the New Year raising prices in an attempt to pass on higher inventory, supplies, and labor costs. In addition to inflation issues, owners are also raising compensation at record high rates to attract qualified employees to their open positions.”
Key findings include:
- One of the Index components improved, seven declined, and two were unchanged.
- Owners expecting better business conditions over the next six months increased two points to a net negative 33%. Small business owners remain pessimistic about future economic conditions as this indicator has declined 13 points over the past six months.
- Forty-seven percent of owners reported job openings that could not be filled, a decrease of two points from December.
- Inventory accumulation plans fell five percentage points.
Keep up with the latest Colorado small-business news at www.nfib.com/colorado or by following NFIB on Twitter @NFIB_CO or on Facebook @NFIB.CO
For more than 77 years, NFIB has been advocating on behalf of America’s small and independent business owners, both in Washington, D.C., and in all 50 state capitals. NFIB is a nonprofit, nonpartisan, and member-driven association. Since its founding in 1943, NFIB has been exclusively dedicated to small and independent businesses and remains so today. For more information, please visit nfib.com.
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