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The NFIB Small Business Optimism Index dropped 2 points to 98.8 in September, remaining slightly above the 52-year average of 98. September’s decrease was due primarily to a decline in the share of small business owners expecting better business conditions and an increase in reports of excess inventory. Of the 10 components included in the index, two increased, five decreased and three stayed the same. Meanwhile, the Uncertainty Index rose 7 points to 100, the fourth-highest reading in over 51 years and well above the 51-year average (68) and the average since 2016 (80).

Labor quality and taxes tied as the top concern for small business owners, with 18% reporting each as the most important problem. Business owners continue to struggle to fill positions despite openings trending down, with 32% of small business owners reporting jobs they could not fill in September, unchanged from August. The share of small business owners in September reporting taxes as a top problem increased 1% from August, with some noting high property taxes in particular. Meanwhile, inflation ranked third in the list of concerns, with 14% reporting it as a top problem, up 3 points from August. Looking forward, a net 31% plan to increase prices in anticipation of rising tariff costs, up 5 points from August.

A net 31% of small business owners reported raising compensation, up 2 points in September after increasing 2 points in August. Meanwhile, 19% of business owners plan to raise compensation in the next three months, down 1 point from August. Pressure on profitability continued to ease, improving 3 points from August to a net negative 16%. Among owners reporting lower profits, 33% blamed weaker sales, 17% cited increased material costs, 10% noted price changes for their product(s) or services(s) and 9% said labor costs. Meanwhile, 7% reported their last loan was harder to get than previous attempts, up 4 points from August, and a net 7% of owners cited paying a higher rate on their most recent loan, up 1 point from the prior month.

The outlook for general business conditions fell 11 points to 23%, still a positive read by historical standards. Additionally, 11% reported that it is a good time to expand their business, down 3 points from August, a rather weak read compared to times of economic expansion. Overall, small business owners remain relatively optimistic, but uncertainty remains very high.

Manufacturing activity in New York state increased in October, with the headline general business conditions index rising 19.4 points to 10.7. The new orders index jumped 23.3 points to 3.7, while the shipments index surged 31.7 points to 14.4. Unfilled orders stepped up from -6.9 to -3.9, while inventories advanced 3.9 points to -1.0, indicating that business inventories continue to shrink but at a slower pace. Delivery times improved, but supply availability decreased 1.9 points to -10.7.

Employment increased in October, with the index for the number of employees rising 7.4 points to 6.2. Meanwhile, the average employee workweek moved up slightly to -4.1 from -5.1 in September, signaling a modest drop in hours worked. The prices paid index rose 6.3 points to 52.4 while the prices received index moved up 5.6 points to 27.2, a reflection of a faster pace of increase for prices received and prices paid.

In October, firms’ optimism regarding the future rose to its highest level since January. The future business activity index climbed 15.5 points to 30.3. In the next six months, new orders are still expected to increase, and at an accelerated pace compared to last month at 34.9. The future employment index stepped up to 7.5, suggesting an anticipated faster pace of employment growth over the next six months. On the other hand, input prices are expected to rise at a faster pace, increasing from 57.8 to 65.0, while selling price expectations are forecasted to stay relatively consistent, inching up 0.6 points to 43.7. Meanwhile, capital spending plans improved but remained weak, moving up from -3.9 to -2.9.

In October, Philadelphia’s regional manufacturing activity declined following growth in September. Falling from 23.2 to -12.8, the index for current general business activity recorded its largest decline since April. This month, 25.2% of firms reported decreases in activity, while just 12.4% of firms noted increases. The index for new orders improved, rising from 12.4 to 18.2, while the index for shipments fell from 26.1 to 6.0. Meanwhile, the employment index ticked down 1 point to 4.6 as the average employee workweek decreased 2.1 points to 12.8.

The indexes for prices paid and prices received both increased, rising from 46.8 to 49.2 and from 18.8 to 26.8, respectively, suggesting prices rose at a faster pace in October. As has been the case for many months, the prices received index remained lower than the prices paid index, indicating that manufacturers have been absorbing a portion of higher costs paid.

Looking ahead, indicators showing expectations for future growth have continued to improve from previous months. After moving up 6.5 points in September, expectations for future business activity rose 4.7 to 36.2 in October. The growth came from a drop in the proportion of firms expecting a decrease in activity (11.2%). On the other hand, a smaller share of firms (47.4%) also expect increases in activity compared to last month’s reading of 52.2%. The future new orders index stepped up from 42.4 to 49.8, and the future shipments index jumped from 31.0 to 48.4. The capital expenditures index rose from 12.5 to 25.2. When asked about 2026, 35.5% of firms expect higher capital expenditures, a notable boost, but that increase was concentrated in noncomputer equipment expenditures. The future prices paid and prices received indexes dropped from 69.8 to 59.8 and from 64.8 to 45.7, respectively. Additionally, the index for future employment stepped down from 23.7 to 21.4.

The NAM’s mission of supporting the people who make things in America would not be possible without the organization’s board of directors.

Say hello: The NAM is pleased to announce its newest board members—committed and exemplary professionals dedicated to the success of manufacturing in the United States. The newest members will begin their two-year terms in January 2026. The additions, who come from across industries and leadership roles in manufacturing, include the following:

• Orlando Alvarez, chairman and president, bp America; senior vice president, Gas & Power Trading Americas; president and CEO, bp Energy Company
• Neil Barua, president and CEO, PTC Inc.
• Bruce Bodine, CEO, The Mosaic Company
• Rogerio Branco, executive vice president, chief supply chain officer, Eaton
• Rodney Bull, CEO, Komatsu America Corp.
• Eleanor Cabreré, senior vice president, general counsel and corporate secretary, International Motors, LLC
• Josh Chou, chief global supply chain officer, McCormick & Company, Inc.
• Keira Driansky, executive vice president, president North America, Ipsen Biopharmaceuticals, Inc.
• Henrietta Fuchs, partner, Manufacturing & Distribution Practice, CohnReznick LLP
• Alex Housten, chief operating officer, Rheem Manufacturing Company
• Frederick Humphries Jr., corporate vice president, U.S. Government Affairs, Microsoft Corporation
• Christina Keller, CEO and chair, Cascade Engineering, Inc.
• Erik Lampe, president and CEO, The Vollrath Company
• Rebecca Liebert, president and CEO, The Lubrizol Corporation
• Laura Matz, chief science and technology officer, Merck KGaA, Darmstadt, Germany
• Timothy Mulhere, CEO, Fortrex Solutions
• Sam Paul, senior managing director, Accenture
• Thomas Peddicord, managing director and senior partner, North America Industrial Goods Practice, Boston Consulting Group
• Heather Remley, president and CEO, BASF Corporation
• Toby Rice, president and CEO, EQT Corporation
• Ronald Richardson, chief revenue officer, FourKites, Inc.
• Scott Richardson, president and CEO, Celanese Corporation
• Brandon Spencer, president, Motion Business Area, ABB Group
• Dave Valkanoff, executive vice president, chief operating officer, Benchmark Electronics, Inc.
• Tom Williams, executive vice president and chief marketing officer, BNSF Railway Company
• Bryan Wright, partner, manufacturing national sector leader, Forvis Mazars, LLP

The NAM’s take: “The next few years will shape the manufacturing industry’s trajectory for decades. At a pivotal moment, the NAM will be stronger thanks to the service of our new board members,” said NAM President and CEO Jay Timmons.

“They will help lead the charge as we drive a comprehensive manufacturing strategy that empowers every manufacturer across the United States to build, invest, grow, thrive and lead. On behalf of the entire NAM team, I am grateful for their partnership as we advance the values that have made America exceptional and our industry strong—free enterprise, competitiveness, individual liberty and equal opportunity.”

In July, the S&P Cotality Case-Shiller U.S. National Home Price NSA Index recorded a 1.7% annual gain, one of the weakest annual price increases in the past decade. The 10-City Composite saw an annual increase of 2.3% in July, down from 2.7% the previous month, while the 20-City Composite rose 1.8% year-over-year, down from 2.2%. Among the 20 cities, New York again posted the highest annual gain at 6.4%, followed by Chicago at 6.2% and Cleveland at 4.5%. Tampa again recorded the lowest annual return, with prices falling 2.8%.

On a month-over-month basis, the U.S. National Index ticked down 0.2% before seasonal adjustment. At the same time, the 10-City and 20-City Composites both decreased 0.3%. After seasonal adjustment, the National Index and the 10-City and 20-City Composites all fell 0.1%.

Short-term price movements in July underscore the housing market’s fragility. Geographic divergence continues to characterize changes as Northeastern and Midwestern markets, after seeing modest price growth, are now top performers. Sun Belt and Western markets are now faring worse, including Tampa (down 2.8%), Phoenix (down 0.9%), Miami (down 1.3%), San Diego (down 0.7%) and San Francisco (down 1.9%).

This housing cycle is showing signs of normalization with the ongoing rotation in regional performance. Stability is emerging as markets with strong local economies are thriving in a market more aligned with overall inflation. Furthermore, this new equilibrium points to a healthier trajectory for housing in the long run.

Consumer confidence decreased 3.6 points in September to 94.2, the lowest level since April. Among its components, the Present Situation Index and Expectations Index both declined, with consumers’ pessimism about future job availability and future business conditions being partially mitigated by stronger expectations about future income.

The Present Situation Index, reflecting current business and labor market conditions, fell 7 points to 125.4. Meanwhile, the Expectations Index, which reflects consumers’ short-term outlook for income, business and labor market conditions, declined 1.3 points to 73.4, remaining below the recession signal threshold of 80 since February 2025.

Views of the current labor market situation are still poor, with 26.9% of consumers saying jobs were “plentiful,” down slightly from August (30.2%), while 19.1% said jobs were “hard to get,” unchanged from August and up from 14.5% in January. Looking to the future, 25.6% anticipate fewer available jobs in the next six months, down slightly from 25.9% the prior month.

Mentions of high prices and inflation rose in September, regaining the top position influencing consumers’ views of the economy. Meanwhile, mentions of tariffs declined in September but continued to be associated with concerns about higher prices. Consumers’ 12-month inflation expectations stepped down from 6.1% to 5.8% in September. Meanwhile, 51.9% of consumers, compared to 52.1% in August, expect interest rates to rise, and a larger share of consumers (25.6% vs. 23.6% in August) expect rates to fall.

Buying plans for cars decreased in September, while buying plans for homes increased to a four-month high. Consumers’ plans for buying big-ticket items changed little overall in September but exhibited variation across items. For example, intentions to purchase TVs and dryers rose the most, while refrigerators saw the largest declines. Vacation intentions fell again to the lowest level since April, with lower intentions to travel abroad driving the decline. Overall, consumers’ views of their current and future financial situation declined slightly from August.

In September, Texas factory activity continued to expand but at a slower pace than the prior month. The production index declined from 15.3 to 5.2, falling below the average of 9.6. Other measures also moved down in September, pointing to slower growth. The new orders index fell 8.4 points into negative territory in September, decreasing to -2.6. Capacity utilization slipped 9.8 points to 3.9, while shipments dropped 7.5 points to 6.7.

Perceptions of manufacturing business conditions worsened in September, with the general business conditions index falling 6.9 points to -8.7, while the outlook also declined, with the company outlook index decreasing 4.3 points to -1. Meanwhile the uncertainty index dropped 4.4 points to 13.9, below the series average of 17.2.

Labor market indicators suggest a decline in headcounts and a slightly longer workweek in September, with the employment index dropping 12.2 points to -3.4, while the hours worked index fell 11.6 points but remained positive at 3.4. Nearly 13% of firms reported net hiring while a larger percentage (16.1%) noted net layoffs.

Price and wage pressures were largely unchanged in September. The prices paid for raw materials index edged down 0.3 points to 43.4. Meanwhile, the prices received for finished goods index declined 3.4 points to 11.7. The wages and benefits index inched up 0.5 points to 15.9 but stayed below the series average of 21.

The outlook for future manufacturing activity weakened from August, with the future production index falling 8.8 points to 31.6. Meanwhile, the future general business activity index and future company outlook index both declined, dropping to 8.4 and 11.7, respectively.

The S&P Global Manufacturing PMI was 52.0 in September, down slightly from the August reading of 53.0. New orders increased for the ninth consecutive month, although at a slower rate and below the survey average. Tariffs continued to hit exports, particularly to Canada and Mexico, and lead to increased input and output costs in September. Nonetheless, output price inflation slowed to its weakest pace since January.

Despite a slowdown in demand growth leading to weaker output gains, production rose sufficiently to allow stocks of finished goods to rise for the second consecutive month amid worries over tariffs and supply-side uncertainty. Meanwhile, delivery times lengthened in September due to difficulties importing goods and stock shortages.

Although tariffs continued to weigh on business confidence, overall business expectations improved slightly compared to August. Many manufacturers anticipate an increase in sales over the next year, and some see tariffs as driving expansions in domestic production. Furthermore, despite ongoing uncertainty related to trade and government policies, many manufacturers increased employment levels in September.

In September, global manufacturing activity was relatively unchanged from August, inching down from 50.9 to 50.8. Output and new orders both rose for the second consecutive month in September. However, these increases failed to stimulate other gains, with staffing levels remaining stable for the second consecutive month and new export business falling for the sixth consecutive month. Meanwhile, supply chains remained stretched as lead times lengthened for the 16th consecutive month.

India, Thailand, Netherlands and Myanmar had the highest PMI readings in September. On the other hand, the U.K., Brazil and Canada were some of the larger nations to register declines in activity. The upturn in manufacturing output occurred across consumer, intermediate and investment goods categories for the second consecutive month, with the pace of growth being greatest for consumer goods.

Meanwhile, price pressures eased slightly in September, with the rate of increase in input and output costs both slowing. Forward-looking indicators were more positive, with future output and export orders advancing from the prior month, but the surge in finished goods inventory suggests that production growth could be due largely to stockpiling rather than an improvement in demand.

In September, the U.S. manufacturing sector contracted for the seventh consecutive month but at a slower pace than the prior month, with the ISM Manufacturing^® PMI increasing to 49.1% from 48.7% in August. One of the four demand indicators improved in September, with the Backlog of Orders Index rising 1.5 percentage points to 46.2%. Meanwhile, the New Orders, New Export Orders and Customers’ Inventories Indexes contracted at faster rates. On the other hand, the Employment Index (45.3%) declined at a slower pace, while the Production Index returned to growth after contracting in August, increasing from 47.8% to 51%.

The New Orders Index contracted after one month of expansion, falling 2.5 percentage points from August. The index hasn’t shown consistent growth since a 24-month streak of expansion ended in May 2022. Of the six-largest manufacturing sectors, none reported an increase in new orders. Respondents continued to note concern about near-term demand, primarily driven by tariff costs and uncertainty.

The New Export Orders Index contracted for the seventh consecutive month at a faster pace, 4.6 percentage points lower than August. The continued contraction is likely indicative of dampened demand amid ongoing trade tensions and policy uncertainty. Meanwhile, the Imports Index contracted for the sixth consecutive month and at a faster rate, down 1.3 percentage points to 44.7% in September. Imports continued to contract as tariff pricing results in lower demand compared to prior months.

The Employment Index contracted for the eighth consecutive month but at a slower pace than the prior month, up 1.5 percentage points from August to 45.3%. Of the six-largest manufacturing sectors, none reported increased employment. Companies continued to focus on layoffs and attrition to restrict headcounts due to uncertainty around near- to mid-term demand. For every comment on hiring, three respondents noted reduced headcounts.

The Prices Index decreased 1.8 percentage points to 61.9%, indicating raw materials prices grew for the 12th straight month in September, but at a slower pace. Of the six-largest manufacturing sectors, all reported increased prices, led by machinery. The increase continues to be driven by steel and aluminum price increases impacting the entire supply chain, as well as the tariffs applied to most imported goods. Roughly 32.5% of companies reported paying higher prices, slightly down from 33.5% in August but still up dramatically from 21% in January.