The NFIB Research Center’s quarterly Small Business Economic Trends survey splits its results by industry, and the April edition shows construction owners leading the pack. The overall Optimism Index was 95.8, below the 51-year average of 98, while construction came in at 100.9, the highest of the four reported sectors. For builders, the value of the report is not the headline number; it is the breakdown of hiring plans, job openings, and labor quality that shows where the next quarter’s bottlenecks will be.
Owners who track those shifts and act on them tend to react faster than competitors who wait for the next issue to surface. One common move is to use the quiet quarter between surveys to attend industry leadership conferences and compare notes with owners facing the same labor and material conditions.
The survey covers construction, manufacturing, retail, and services, and it matters to anyone who builds because those sectors are the customers and suppliers of the building trades. Retailers order the fixtures for new stores, manufacturers supply the materials that arrive on jobsites, and services firms handle the engineering and permitting that precede construction.
The divergence between sectors matters more than any single number. Retail and manufacturing fell harder while construction and services held up, and that split reshapes the competitive picture: builders selling into industrial markets saw steadier demand than builders depending on strip-center renovations.
How the Optimism Index Works
The Optimism Index is a seasonally adjusted net measure built from ten survey components, including plans for capital spending, expected sales, job openings, hiring plans, and views of business conditions. A reading above 98 means the average owner in the group leans optimistic; construction at 100.9 sits 5.1 points above the reading for all firms.
The 51-year average of 98 is the reference line most owners ignore. Because the index is a net measure, readings cluster in a narrow band: a 3-point move is meaningful, while a 10-point move is rare. That makes the April gap between the 95.8 overall reading and the 100.9 construction reading a real separation, not noise.
Why the industry breakdown matters
The four-sector split is published quarterly, which gives owners a faster read than the monthly national number alone. When construction optimism runs ahead of the overall index, equipment vendors and material suppliers see it first in their order books, and builders can use the same signal to decide when to buy trucks, extend shop space, or hold off on expansion. Many owners use the between-survey months to attend construction industry events and trade shows, where exhibitor order books confirm what the index only hints at.
Net percentages in plain terms
Each component is reported as a net percentage: the share of owners reporting improvement minus the share reporting deterioration. A net 20 percent planning to hire means 20 more owners out of 100 plan to add staff than plan to cut it, not that 20 percent of all firms are hiring. The distinction keeps a healthy reading from being mistaken for a hiring boom.
Construction Leads the Four Sectors
Construction posted an index of 100.9 in April, down 3.9 points from January but still the smallest decline of the four industries. Owners in the sector were the most optimistic of the group, and the reading ran 5.1 points higher than the figure for all small firms.
| Metric | Construction reading | Comparison |
|---|---|---|
| Optimism Index, April | 100.9 | 5.1 points above all firms |
| Unfilled job openings | 55% | 21 points above all firms |
| Net percent planning to hire | 20% | 7 points above all firms |
| Owners citing labor quality as top problem | Nearly a third | Highest of four industries |
The labor picture is where the optimism meets reality. More than half of construction firms, 55 percent on a seasonally adjusted basis, reported unfilled job openings, the highest share of any industry and 21 points above the all-firm average. Construction was also the only sector where unfilled openings increased from the previous quarter.
The applicant shortage is getting worse
Fifty-six percent of construction owners said they had few or no qualified applicants for their open positions, up five points from the previous quarter, and nearly a third named labor quality as their single most important problem. A seasonally adjusted net 20 percent plan to hire in the next three months, down 12 points from January but still seven points higher than the reading for all firms.
- Hiring plans softened, but construction still plans to add staff faster than most firms.
- The applicant pool deteriorated, with more owners reporting few or no qualified candidates.
- Labor quality is now the top problem for nearly one in three construction owners.
Other industry surveys tell the same story from a different angle. A separate industry survey indicates improvements in architecture revenue, and the parallel is useful: when design firms are busy, construction backlogs usually follow a few quarters later.
Reading the hiring number correctly
The net 20 percent hiring plan is the second-highest of the four industries, just behind manufacturing, and it measures intent, not placement. Builders who compare their own open positions against the 55 percent unfilled-job-opening figure can tell whether their labor gap is an industry condition or a local one.
Manufacturing and Services Stay Above the Long-Term Average
Manufacturing came in at 99.6, down 6.8 points from January, the largest quarter-over-quarter change of the four industries, yet still above the overall small business community and above the 51-year average of 98. Services, the fourth reported sector, also remained above that line even as the group’s combined index slipped.
What a six-point swing means for material supply
Manufacturing optimism drives inventory decisions at lumber yards, fastener distributors, and equipment dealers. When manufacturers turn cautious, lead times on specialty items lengthen as they trim production schedules, and builders who keep a rolling material forecast instead of buying job to job smooth over those swings. Specification knowledge becomes a competitive edge when supply tightens, and trade shows that educate builders on product specification pay off exactly then, when shortages force substitutions on the jobsite.
Services as a leading indicator
Services firms handle the design, engineering, and permitting work that precedes construction starts. Their optimism holding above 98 suggests the pipeline of projects in planning is intact even while builders report softer sales expectations, which is the best forward signal in the whole report.
Retail Drags the Group Average
Small retailers were the clear laggard, with optimism running well below the other three industries and below the 51-year average. The declines across all four sectors traced to more pessimistic views of future business conditions, supply chain disruptions, and ongoing labor quality concerns, according to the research center’s director.
What retail weakness means for builders
Retailers are the tenants of much commercial construction, and soft retailer optimism usually delays store build-outs and renovations. Builders with mixed commercial and residential books can watch this number as a weather vane for the next six months of tenant improvement work, while the operators who keep improving tend to attend the conferences and trade shows that build better builders through field-level case studies.
Supply chain and labor quality overlap
Supply chain disruptions and labor quality were named together by owners across all four sectors, and the two problems compound. A crew short a skilled carpenter wastes material waiting for a reorder, and a supply delay burns hours that could have been spent on another job. Fixing either problem helps with both.
Turn the Survey Into Decisions
The report’s most useful line concerns business health: at least 60 percent of small firms in every industry describe their own business as in excellent or good health, even while optimism about the broader climate fades. Owners who keep their own books healthy through a soft stretch tend to talk to each other, and attending construction industry conferences and trade shows puts a builder in the room with owners who have already made the mistakes the current quarter is exposing.
The 60 percent health figure is worth reading twice. Owners who say their business is healthy while the economy is not are describing demand that comes from backlog and repeat customers rather than new starts, which is exactly the mix a builder wants to protect.
Three questions to ask after reading the survey
- Are my open positions above or below the 55 percent unfilled rate for construction?
- Is my hiring plan consistent with a net 20 percent industry reading, or am I running counter-cyclical?
- Which of my suppliers sit in manufacturing, and what is their lead time doing?
Each question converts a national statistic into a local action. The answers will differ by market, but the discipline of asking them every quarter costs nothing.
Watch the Next Release With a Baseline
The April survey set a baseline: construction at 100.9, manufacturing at 99.6, retail below the long-term average, and an overall reading of 95.8. The next quarterly release will show whether construction holds its lead or the 3.9-point decline extends.
Pair the index with operational data
The optimism index is a mood reading, and it becomes useful when paired with operational data. Builders who track their own backlog, bid win rate, and crew utilization can compare their trajectory with the industry’s, and recent construction technology surveys show how the firms pulling ahead use software to track those numbers.
A baseline is only useful if it is written down. A one-page monthly dashboard with backlog, open positions, and bid pipeline takes ten minutes to update, and it turns the next NFIB release from news into a check against your own numbers.
The next survey lands in a few months. The owners who get value from it will not be the ones who read the headline; they will be the ones who wrote down their own numbers in April and checked them again when the new index arrives.