NASHVILLE, TN – Inflation and worker shortages are increasing pressure on small businesses, while fresh government data show consumer and producer prices accelerating in September.
The National Federation of Independent Business (NFIB) says inflation was the second-largest problem for small-business owners at 20%, while labor quality and availability remained first at 26%. Its September Optimism Index slipped to 97.9, just below its 52-year average.
The Consumer Price Index rose 0.6% in September and 3.7% from a year earlier. Core inflation increased 0.3% for the month and 2.6% annually. Producer prices climbed 1.3% in September and 6.3% from a year earlier, with energy and goods costs driving much of the increase.
Financial markets responded by raising expectations for another Federal Reserve rate increase. Treasury yields moved higher and stocks weakened after the inflation reports.
For farmers and rural businesses, persistent inflation can keep fuel, materials, equipment and financing costs elevated even as labor remains difficult to find.
Farm-Level Takeaway: Higher inflation and tight labor conditions could keep operating and borrowing costs elevated for farms and rural businesses.