The NFIB Small Business Optimism Index fell 0.6 points in May to 95.3, which is below its 52-year average of 98.0.
In addition, its Uncertainty Index rose 3 points from April to 91, significantly above its historical average of 68.
The NFIB Small Business Employment Index remained mostly flat. In May, 29% of small business owners reported job openings they could not fill.
“AI investment spending has contributed to some excitement in the economy,” said NFIB Chief Economist Bill Dunkelberg in a statement. “Despite the enthusiasm around AI, the overall picture is divided. More small business owners are struggling with significant and unpredictable hikes in fuel prices, which are more challenging for small businesses to pass on to their customers compared to their larger corporate competitors.”
Labor costs have hit historic heights, with farmers and agri-business owners paying more for seeds, fertilizers, fuel and equipment. Overall sales expectations are also weakening.
“With labor costs hitting historic highs and overall sales expectations weakening, Wisconsin’s independent producers and small businesses are being forced to work twice as hard for significantly less money,” NFIB Wisconsin State Director Luke Bacher said in a statement.
