Prairie State Wire

The National Federation of Independent Business (NFIB) Small Business Optimism Index saw a rise of 3.4 points in December, reaching 105.1. This marks the second consecutive month that the index has remained above the 51-year average of 98 and is the highest reading since October 2018. Of the ten components of the Optimism Index, seven increased, two decreased, and one remained unchanged. The Uncertainty Index experienced a decline of 12 points in December, dropping to 86.

"Optimism on Main Street continues to grow with the improved economic outlook following the election," stated NFIB Chief Economist Bill Dunkelberg. He added that small business owners are feeling more certain and hopeful about the economic agenda under the new administration. "Expectations for economic growth, lower inflation, and positive business conditions have increased in anticipation of pro-business policies and legislation in the new year."

Despite this surge in optimism among small businesses nationwide, Illinois entrepreneurs remain focused on overcoming workforce challenges and managing costs. Noah Finley, NFIB Illinois State Director, emphasized that "the Illinois General Assembly must prioritize legislation that makes it easier for small businesses to grow, hire, and thrive."

Key findings from the report include a significant increase in expectations for economic improvement among owners—rising by 16 points from November to a net 52%, which is seasonally adjusted and represents the highest level since late 1983. Additionally, there was an increase in small business owners who believe it is a good time to expand their operations; this figure rose six points to reach 20%, seasonally adjusted.

Other notable findings include a net percentage of owners planning inventory investments rising five points from November to reach its highest level since December 2021. Reports also indicate that while some sectors saw frequent price hikes—including finance (56% higher), retail (38% higher), construction (30% higher), and transportation (30% higher)—a net percentage plan further price increases moving forward.

The survey also revealed labor quality as a persistent issue for business owners with no change from November's figures at 19%. Labor costs remained unchanged as well at 11%, slightly below its peak recorded in December 2021.

The NFIB Research Center has been gathering data on Small Business Economic Trends through quarterly surveys since late 1973 and monthly surveys since 1986. Survey participants are randomly selected from NFIB’s membership base. The current survey was conducted in December 2024.