The National Federation of Independent Business reported a March reading of 95.2 for its Small Business Optimism Index versus an unrevised 98.0 during February. The figure was its lowest since June of last year.

Movement in the component series was negative last month. The percentage expecting the economy to improve dropped sharply to -7%, down from the November high of 13%. The percentage of firms expecting higher real sales slipped to 13 and was off the high of 20% three months ago. Also falling to 10% was the percentage planning to increase employment, down from the December high of 15%. The percentage indicating few or no qualified applicants for job positions declined m/m to 42%, the same as in January. The percent with positions not able to be filled right now reversed three months of increase and fell to 24%.

The percentage of companies indicating that now was a good time to expand the business dropped sharply to 10%, the lowest point since August. The percentage indicating that credit was harder to get rebounded to 5%, its most since November. The percentage planning to add to inventories reversed course with a decline to 1%, its least since August and the percentage planning capital expenditures in the next 3-6 months returned to its lowest point in six months.

On the pricing front, 2% of firms were raising average selling prices last month after none in February. The percentage planning price increases, however, fell to 15%, its least since July 2013. Labor's pricing power eased as the percentage of firms raising worker compensation recovered to a still-low 22%. The percentage planning to raise compensation edged down to 13%, near the middle of the last year's range.

The most important problems faced by small business were taxes (23%), government requirements (22%), quality of labor (12%), poor sales (11%), competition from large businesses (8%), insurance cost & availability (7%), cost of labor (4%), financial & interest rates (3%) and inflation (2%).

Roughly 24 million small businesses exist in the U.S. and they create 80% of all new jobs. The typical NFIB member employs 10 people and reports gross sales of about $500,000 a year. The NFIB figures can be found in Haver's SURVEYS database.