NFIB Small Business Employment Index Rises in July

The National Federation of Independent Business reported a rebound in the small business job market in its July employment report. The NFIB Small Business Employment Index rose 1.9 points to 102.1, ending a four-month period of decline.

Despite the index increase, actual hiring activity declined by 1 point from June. Forward-looking sentiment remains positive, however, with 20% of owners planning to create new jobs over the next three months, the highest level of expansion intent since October 2022.

Small businesses continue to face a persistent worker shortage. Approximately 36% of owners reported unfilled job openings, while 27% identified labor quality or availability as their primary challenge. In response, 31% of small businesses raised compensation in July, and many plan further pay increases in the coming quarter to attract staff.