The NFIB Small Business Optimism Index for July releases Tuesday August 11 at 6:00 ET, and the sub-index the CPI supercore desk actually watches is not the headline. It is the net percent of firms planning to raise worker compensation in the next three months, which sat at plus 21 percent in the June release. That series leads the CPI supercore services line by roughly two quarters through the historical fit, and the July print is the last small-business wage read the September 17 FOMC will have before writing the balance-of-risks paragraph.

The mechanic

Small firms employ roughly 46 percent of private-sector US payroll (SBA Office of Advocacy, 2024). Because small-firm wage decisions run through payroll on a compressed lag (a small business raising posted pay in August books the higher wage in the September or October payroll cycle, not the following spring), and because the CPI supercore services basket is roughly 65 percent labor cost at the input level (BLS relative-importance table for December 2025), the NFIB compensation plans series threads directly into supercore prints one to two quarters out.

The fit is not tight month to month. It is directional and quarterly, and the two-quarter lead is stable across the 2010 to 2025 sample. The Cleveland Fed’s 2019 working paper on small-business wage-setting (Barnichon and Shapiro) estimated the coefficient at roughly 0.6 basis points of CPI supercore services per one-point move in NFIB compensation plans, two quarters forward, which is the point-estimate range the desk carries into the July print.

The June anchor

The June NFIB compensation plans net at plus 21 percent was the highest three-month average since Q3 2024. Read through the two-quarter lead and the 0.6 basis point coefficient, that print pointed toward a CPI supercore services annualized run rate inside the 3.4 to 3.8 percent band for Q4 2026 releases, which is where the June CPI supercore three-month annualized at 3.4 percent currently sits.

The June read is what the July 30 FOMC statement priced into the balance-of-risks paragraph when it walked the September dot plot to a 50 percent two-cut year. The strip carried that signal into Friday’s July NFP print at minus 23 thousand and Sunday’s close at a 92 percent September cut probability.

The July print resolves two lines

A July compensation plans print at or below plus 18 percent confirms the labor-market softening that the ISM services employment print at 47.4 (August 5) and the July NFP headline at minus 23 thousand (August 8) already flagged. Read through the coefficient, three points lower on NFIB compensation plans maps to roughly 1.8 basis points lower on CPI supercore services two quarters out, which walks the annualized run rate into the 3.0 to 3.4 percent band the December second cut prices against. The strip carries the December 10 second cut at 62 percent into Tuesday’s tape; a soft NFIB comp print walks it toward 68 percent before CPI Wednesday.

A July compensation plans print holding at plus 21 percent cuts against the labor softening the payroll print delivered and reads as a small-business wage backdrop that has not yet turned. Under that scenario, the coefficient walks Q4 supercore back inside the 3.6 to 4.0 percent band, and the strip walks the September cut probability back toward the 82 percent floor the pre-NFP tape ran on the July 15 CPI print.

A July compensation plans print through plus 24 percent is the tail. It has not printed since Q1 2022 and would read as a one-month noise print rather than a signal reversal, but a second consecutive print above plus 24 in the August release (September 9 wire) would be the fastest three-month move in the compensation series since 2021 and would carry direct implications for the September dot plot.

The line that matters into Wednesday’s CPI

The two-quarter lead means Tuesday’s NFIB print does not resolve Wednesday’s CPI. What it does resolve is the coefficient the strip prices into Q4 supercore releases (September 11 CPI, October 15 CPI, November 12 CPI), which are the three prints the December 10 FOMC will read before the second cut vote.

The single line the desk watches on Tuesday’s 6:00 ET wire is compensation plans, net percent, seasonally adjusted, plus or minus three points relative to the June print at plus 21. Everything else on the NFIB release, the headline, the earnings trends line, the hiring plans line, is secondary.

Sources