Small business optimism in February hit levels not seen in 35 years, the National Federation of Independent Business said Tuesday.

National Federation of Independent Business

“When small business owners have confidence and certainty in the economy, they’re able to hire more workers and invest in their businesses,” said NFIB President and CEO Juanita Duggan. “The historically high readings indicate that policy changes – lower taxes and fewer regulations – are transformative for small businesses. After years of standing on the sidelines and not benefiting from the so-called recovery, Main Street is on fire again.”

The Small Business Optimism Index climbed to 107.6 in February from 106.9 in January. The February index is the second highest level in its 45-year history, trailing only a 108.0 reading in 1983

“For the first time since 2006, taxes received the fewest votes as the number one business problem for small business,” the survey noted.

About 22% of respondents said they expect to increase pay levels, while two of three said they made capital outlays, the highest level since 2004.

“Small business owners are telling us loud and clear that they’re optimistic, ready to hire, and prepared to raise wages – it’s one of the strongest readings I’ve seen in the 45-year history of the Index,” said NFIB Chief Economist Bill Dunkelberg. “The fact that several components saw significant increases tells us that small businesses are flourishing in a way we haven’t seen in over a decade.”

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Gary Siegel

Gary Siegel

Gary Siegel has been at The Bond Buyer since 1989, currently covering economic indicators and the Federal Reserve system.