Since 1973, NFIB Index results have accurately predicted recessions. For over a year, small business owners have indicated via NFIB Index responses that a recession is coming, but it has yet to arrive.
The NFIB Index tracks business owners’ optimism through an index that measures a set of “hard” and “soft” components. The “hard” components include things like earnings and hiring and capital expenditure plans, while “soft” numbers include expectations around business conditions, sales, and credit conditions. Historically, these two indicators have moved in sync, but they had a major deviation in 2020 with the emergence of the COVID-19 pandemic. Business owners had dire expectations for their business’ future—even amid measured improvements.
In September 2023, NFIB’s Optimism Index dropped to 90.8, well below its decadeslong 98-point average. The…
