The National Federation of Independent Business’ (NFIB) optimism index fell to 90.1 last month from 90.9 in February, the group said in a report Tuesday.

“Small business owners are cynical about future economic conditions,” NFIB Chief Economist Bill Dunkelberg wrote in the release. “Hiring plans fell to their lowest level since May 2020, but strong consumer spending has kept Main Street alive and supported strong labor demand.”

Inflation remained the single most important issue impacting small businesses, with 24% of business owners flagging this as the biggest operational problem facing their companies.

Meanwhile, labor was the second-biggest problem for small businesses, with 43% of all owners reporting that job openings were difficult to fill, the NFIB’s survey showed.

The concern comes as new federal hiring data released Friday showed that the labor market continues to add jobs at a strong pace. Employers added 236,000 jobs in March while unemployment stayed low at 3.5%.

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