US small business optimism surges on post-election relief

Photo / Renee Cordes "Main Street breaks 34-month streak of record high uncertainty," the National Federation of Independent Business said in its latest barometer. The storefronts shown here are in the Piscataquis County town of Monson.

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By Renee Cordes

U.S. small business optimism in November surged to its highest level in nearly three and a half years, as business owners looked forward to tax cuts and regulatory relief from President-elect Donald Trump's administration.

The National Federation of Independent Business said its optimism index rose by eight points in November to 101.7, the highest reading since June 2021. The increase follows 34 months of remaining below the 50-year average of 98.

“The election results signal a major shift in economic policy, leading to a surge in optimism among small business owners,” said Bill Dunkelberg, chief economist of the Washington, D.C.-based organization.

“Main Street also became more certain about future business conditions following the election, breaking a nearly three-year streak of record high uncertainty,” he added. “Owners are particularly hopeful for tax and regulation policies that favor strong economic growth as well as relief from inflationary pressures. In addition, small business owners are eager to expand their operations.”

NFIB has conducted monthly surveys since 1986. Of the 10 components that make up the index, nine increased in November, none decreased and one was unchanged.

David Clough, the organization's Maine state director, told Mainebiz in an emailed statement that the latest economic trends report "is encouraging as we head into the long winter months in New England.

"However, inflation pressures, labor costs — which will increase by law in 2025 in Maine — and workplace staffing challenges are expected to persist," he noted.

Some 28% of businesses surveyed plan capital outlays in the next six months, up from 22% in October, while 14% said they believe this is a good time to expand their business.

Business advisors on the ground are seeing a similar sentiment from their clients.

"In Maine, our small businesses aren't just enterprises; they're the heart and soul of our communities,” said Nancy Strojny, deputy director of SCORE Maine. “Their optimism fuels our economy, creating jobs, fostering innovation, and weaving the tapestry of our state's unique character."

Diane Sturgeon, the Maine district director for the U.S. Small Business Administration, said, "Most of the small businesses I've spoken with recently are talking about local issues and taking a bit of a wait-and-see attitude about the impact of the election."