Show-Me State Times

The NFIB Small Business Optimism Index increased by 0.5 points in August, reaching 100.8, which is nearly three points above its long-term average. The survey found that four of the index’s ten components improved, while four declined and two remained unchanged. The largest contributor to the rise was an increase in owners expecting higher real sales.

According to NFIB Chief Economist Bill Dunkelberg, “Optimism increased slightly in August with more owners reporting stronger sales expectations and improved earnings. While owners have cited an improvement in overall business health, labor quality remained the top issue on Main Street.”

NFIB State Director Brad Jones commented on Missouri’s business environment: “Although finding qualified applicants remains a serious challenge for Main Street employers, optimism is improving. Ensuring Missouri remains a wonderful place to own and operate a small business is essential to our state’s economy.”

Survey data showed that 14% of respondents rated their business health as excellent and 54% as good, both showing slight increases from July. Those rating their business as fair dropped to 27%, while those reporting poor conditions stayed at 4%. Labor quality continued as the leading concern for small businesses; 21% identified it as their most significant problem.

In August, 32% of owners reported unfilled job openings—a decrease from July—marking the lowest level since July 2020. The share of owners planning to create new jobs rose for the third consecutive month but remains low by historical standards.

Within sectors such as construction, manufacturing, and transportation, hiring difficulties were particularly notable. In construction specifically, almost half reported job openings they could not fill—a figure that has declined compared to last year.

Among those hiring or attempting to hire in August, most said there were few or no qualified applicants available. Reports of labor costs being the main problem fell slightly from July.

A net 29% of businesses raised compensation in August, with more planning further increases over the next three months. Capital outlays also saw a minor uptick; just over half of businesses made expenditures within six months prior to the survey.

Inventory levels appeared stable with no net change in perceptions that stocks were too low compared to July. Meanwhile, supply chain disruptions affected over half of small businesses surveyed but showed signs of easing compared to previous months.

On pricing trends, fewer owners raised average selling prices than earlier this year—the lowest reading so far for 2025—and inflation concerns held steady among respondents.

Profit trend reports improved modestly from July but remain negative overall. Most who saw lower profits blamed weaker sales or higher material costs; those seeing gains credited increased sales volumes or seasonal factors.

Financing issues persisted at similar rates month-over-month; only a small percentage reported financing and interest rates as their top concern or found loans harder to obtain than before.

Expectations about future business conditions softened slightly since July. Only a minority considered it a good time for expansion.

Taxes ranked second after labor quality among top problems faced by small businesses according to the survey results for August; government regulations followed behind.

The NFIB Research Center has been collecting economic trend data through quarterly surveys since late 1973 and monthly surveys since 1986 using randomly selected members from its organization base. This latest report covers responses gathered during August 2025 and is released monthly by NFIB.