The nation’s monthly bellwether measurement of its Main Street economy released today showed some long-awaited improvements if not a complete turnaround, as the Small Business Economic Trends report published by NFIB, the nations’ leading small business association, recorded its 26th consecutive month below its 50-year average.

“It’s at least nice to see glimmers of hope for the rest of the nation’s small business owners if not for California’s, which are still having to survive under the legislative drag holding them back,” said John Kabateck, the California state director for the National Federation of Independent Business. “Right now, we’re working with our membership in helping them comply with that ridiculously onerous burden of having workplace violence prevention plans in place by July 1. It’s nice to see a personal finance course for high school students qualify for the November ballot. We only wish it was around before most of our legislators were elected to the Assembly and Senate.”

NFIB’s monthly Small Business Economic Trends, or SBET, report is the gold standard measurement of America’s small business economy.

Used by the Federal Reserve, Congressional leaders, administration officials, and state legislatures across the nation, it’s regarded as the bellwether on the health and welfare of the Main Street enterprises that employ half of all workers, generate more net new jobs than large corporations, and gave most of us the first start in our working life.

The SBET, or Optimism Index, is a national snapshot of NFIB-member, small-business owners not broken down by state. The typical NFIB member employs 10 people and reports gross sales of about $500,000 a year.

“While inflation pressures have eased since peaking in 2021, small business owners are still managing the elevated costs of higher prices and interest rates. The labor market has also eased slightly as small business owners are having an easier time attracting and retaining employees,” said NFIB Chief Economist Bill Dunkelberg.

Highlights from the report

Reports of labor quality as the single most important problem for business owners decreased five points to 16%, the lowest reading since April 2020.

The net percent of owners who expect real sales to be higher increased six points from January to a net negative 10% (seasonally adjusted), an improvement from last month.

Small business owners’ plans to fill open positions continue to slow, with a seasonally adjusted net 12% planning to create new jobs in the next three months, the lowest level since May 2020.

Thirty-seven percent (seasonally adjusted) of all owners reported job openings they could not fill in the current period, down two points from January and the lowest reading since January 2021.

The net percent of owners raising average selling prices declined one point from January to a net 21% (seasonally adjusted), the lowest reading since January 2021.