Small business job openings declined sharply in May while concerns over rising labor costs reached the highest level in the survey’s history, according to the National Federation of Independent Business (NFIB) May Jobs Report released Friday.
The NFIB Small Business Employment Index remained essentially flat in May, standing at 100.3 after 100.4 in April. This marks the third consecutive monthly decline. The index now sits below the 2025 average of 101.2, though it remains slightly above the long-term historical average of 100.
In May, 29% of small business owners reported job openings they could not fill, a 5-point drop from April and the lowest reading since May 2020. Openings for skilled workers fell 2 points to 27%, while openings for unskilled positions dropped 4 points to 9%.
“Concerns about rising labor costs increased significantly to the highest reading in the survey’s history,” stated Chief Economist Bill Dunkelberg. “Small business owners are facing mounting pressure to retain workers, and many firms are navigating costly new state mandates. While current conditions restrict Main Street’s already-thin profit margins, compensation measures remain steady for now.”
Arizona-specific concerns added to the unease. “Arizona small businesses are growing increasingly uneasy as labor costs climb and uncertainty around state tax policy remains unresolved,” NFIB State Director Chad Heinrich added. “Failure to conform with the business provisions Congress made permanent at the federal level will result in a tax hike on Main Street Arizonans. Small businesses need certainty to plan, invest, and create jobs, and time is running short for lawmakers to deliver.”
Looking ahead, hiring plans weakened further. A seasonally adjusted net 9% of owners plan to create new jobs in the next three months, down 4 points from April and the lowest level since May 2020. This falls below the historical average of a net 11%.
Overall, 55% of owners reported hiring or trying to hire in May, up slightly from April. However, 46% of all owners (representing 84% of those actively hiring or trying to hire) reported few or no qualified applicants for open positions.
Labor quality, the most important business problem eased to 13%, the lowest since December 2016. In contrast, labor costs surged in importance, cited by 14% of owners as their top problem — a 5 point increase from April and the highest reading on record.
Despite softening demand for new hires, compensation pressures persisted. A net 31% of owners reported rising worker compensation in May, up 1 point from April. Plans to raise compensation in the coming three months held steady at 18%.
Ethan Faverino is a reporter for AZ Free News. You can send him news tips using this link.
Arizona Republican House and Senate leaders announced a compromise budget agreement with Democratic Governor Katie Hobbs on Tuesday and introduced a series of budget bills for consideration in both chambers.
According to a press release by the GOP Senate Caucus, the budget, totaling $18.29 billion, is designed to deliver approximately $1.45 billion in tax relief to Arizonans over a four-year period and to limit state spending growth to 3.05%. The agreed-upon budget also “rejects or modifies more than $3 billion in proposed executive tax increases, fees, and spending expansions over the next three years.”
The legislative GOP leadership and Gov. Hobbs have been embroiled in tense on-again-off-again negotiations since January, with Hobbs announcing a full moratorium on signing legislation, vetoing nearly all bills sent to her desk from April 13 until May 14, including a proposed Republican budget containing over $1 billion in tax relief.
🚨FOR IMMEDIATE RELEASE: Arizona Becomes Only State in the Nation to Deliver Historic Trump Tax Cuts As Part of Bipartisan FY 2027 Budget Agreement
“Arizona is leading the nation once again,” Senate President Warren Petersen (R-LD14) said in a statement. “For years, Arizona has built a reputation as one of the best places in America to live, work, raise a family, and start a business. This budget strengthens that foundation. Families are facing higher costs for groceries, childcare, housing, and everyday necessities, and we wanted to provide real relief. By adopting President Trump’s tax cuts at the state level, expanding tax relief for families, and protecting educational freedom, we’re helping Arizonans keep more of their hard-earned money while ensuring our state remains economically competitive.”
Looks like we have a deal on the budget. Arizona will be the first state in the nation to deliver the full Trump tax cuts! Proud of my colleagues in the House and Senate. Expecting to vote it out on Thursday. And this time, it will get signed.
The budget reportedly incorporates full conformity with the tax cuts of the One, Big, Beautiful Bill Act passed in 2025, which included several of President Trump’s major federal tax provisions, including:
No tax on tips, no tax on overtime,
An increased standard deduction,
A new childcare deduction,
An enhanced child tax credit,
Expanded charitable giving deductions,
Property tax relief for disabled veterans.
In a statement to AZ Free News, Arizona House Speaker Steve Montenegro (R-LD29) said, “Republicans came into this session focused on affordability, responsible spending, public safety, school choice, and protecting taxpayers from new taxes and fees. This agreement reflects those priorities and shows what can be achieved through serious negotiations in divided government. The process still needs to play out, but this is a responsible budget agreement that moves Arizona in the right direction and puts families and taxpayers first.”
According to the Senate GOP Caucus, the budget agreement will also address the ongoing controversy of data center development in the state through the imposition of “a three-year moratorium on the issuance of new certificates for the data center sales tax exemption while explicitly allowing construction of new data centers to continue.”
In addition to implementing the $1.45 billion in tax relief, the budget will also include:
$112 million for corrections operations,
A 4% correctional officer stipend,
$23 million for victims of crime assistance,
$58 million for child safety operations, including foster care coaching and guardian contract costs,
$25.5 million for county support programs, probation services, coordinated reentry efforts, and sheriff assistance,
$10 million for wildfire suppression efforts,
$4.3 million for rural hospitals.
Reforms packaged with the FY2027 budget also include eligibility verification requirements for Medicaid and SNAP benefits, and protections for the Empowerment Scholarship Account program.
Governor Hobbs praised the bipartisan agreement, saying, “This bipartisan, balanced budget agreement will put Arizona first and deliver opportunity, security and freedom to communities throughout the state. With this agreement, we are delivering a $1.4 billion tax cut for working-class families, investing in job creation, education and water security while tightening our belts, and securing a moratorium on the data center tax exemption so we can develop a responsible path forward that protects our water future and lowers utility bills for Arizona families.”
She added, “This bipartisan compromise shows what we can do when we put common sense before political games and focus on delivering real results for our communities. It will put money back in the pockets of Arizona families and lower costs, make our communities safer, and protect the vital services that Arizonans rely on. In the coming days, I look forward to working with legislators in both parties to pass this bipartisan budget agreement that will make Arizona stronger, safer, and more prosperous.”
House and Senate versions of the budget bills will be considered during a Joint Senate & House Appropriations Committee hearing Wednesday, with final votes set for Thursday.
The U.S. Department of the Treasury reported Tuesday that millions of Americans claimed tax relief under President Donald Trump’s Working Families Tax Cuts during the most recent filing season. According to the analysis, low- and middle-income households received the largest share of the benefits.
According to a June 2 press release from the Treasury Department, taxpayers claimed approximately $82 billion in individual tax relief through the April filing deadline under provisions included in the Working Families Tax Cuts. Treasury officials said the total is expected to increase as taxpayers who requested filing extensions continue submitting returns.
Treasury Secretary Scott Bessent said the data demonstrates that the tax package delivered significant relief to working Americans and families.
“American families and workers overwhelmingly benefited from the Working Families Tax Cuts, receiving the largest share of the historic tax relief delivered this past filing season,” Bessent said. “This analysis confirms President Trump’s tax policies deliver substantial tax cuts to hardworking Americans and provide greater relief and financial certainty to low- and middle-income households.”
While Iran’s economy is in free fall, the regime has chosen to co-opt digital asset technologies for its own corrupt agenda, including evading sanctions and transferring wealth out of the country. Iran’s current economic chaos is proof that @POTUS’ maximum pressure campaign has… https://t.co/CJPNSgccqh
— Treasury Secretary Scott Bessent (@SecScottBessent) June 2, 2026
The Treasury Department stated that without the legislation, taxpayers would have faced the scheduled expiration of the 2017 Tax Cuts and Jobs Act, which officials said would have resulted in approximately $5 trillion in tax increases over time. According to the Treasury, 97% of filers who received a tax cut during the most recent filing season would have owed more in taxes absent the extension of the 2017 tax provisions.
The analysis found that tax relief was concentrated among households earning less than $200,000 annually. The Treasury reported that 96% of filers receiving a tax cut earned less than $200,000 per year, while nearly 70% earned less than $100,000.
Among taxpayers earning between $100,000 and $200,000 who claimed one of the tax provisions, the average tax reduction exceeded $1,250. Taxpayers earning between $50,000 and $100,000 who claimed one of the provisions received an average tax cut of more than $815.
The report highlighted several signature provisions included in the package. The Treasury reported that more than 7.5 million filers claimed the “No Tax on Tips” deduction, receiving an average deduction of more than $7,000. According to the department, 90% of taxpayers claiming the deduction earned less than $100,000 annually, while 99% earned less than $200,000.
More than 29 million filers claimed the “No Tax on Overtime” deduction, with an average deduction exceeding $3,100. The Treasury reported that 75% of taxpayers using the provision earned less than $100,000 annually, while 96% earned less than $200,000.
The department also reported that more than 35 million seniors claimed the Enhanced Deduction for Seniors, receiving an average deduction of more than $7,500. According to the Treasury, 68% of participating seniors earned less than $100,000 annually and 94% earned less than $200,000.
Other provisions cited in the report included the “No Tax on Car Loan Interest” deduction, which the Treasury said was claimed by more than 1.4 million taxpayers purchasing qualifying American-made vehicles. Those taxpayers received an average deduction of more than $1,800. The Treasury reported that 62% of claimants earned less than $100,000 annually and 98% earned less than $200,000.
The Treasury also reported that more than 5.5 million Trump Accounts have been opened since the program’s launch, with approximately 1.4 million qualifying for a $1,000 pilot contribution. According to the department, 86% of the accounts are linked to families earning less than $200,000 annually.
The report further found that nearly 40 million families claimed the enhanced Child Tax Credit, which the Treasury noted was permanently expanded under the legislation. Approximately 65% of participating families earned less than $100,000 annually, while 89% earned less than $200,000.
In addition, the Treasury reported that more than 127 million taxpayers—representing roughly 90% of all filers—claimed the permanently doubled standard deduction during the filing season. The department said the provision continues to simplify tax filing requirements for millions of Americans.
Congressman Abraham Hamadeh (R-AZ-08) has introduced the Military and Veterans Fuel Discount Act of 2026, a bipartisan measure designed to deliver direct financial relief to service members, veterans, and their families by providing discounts on fuel purchased at military exchange stores.
The legislation, H.R. 9027, is co-sponsored by Representatives Don Bacon (R-NE-02), Eugene Vindman (D-VA-07), Don Davis (D-NC-01), and Jimmy Panetta (D-CA-19). It authorizes the Secretary of Defense to implement a program offering discounts on motor fuel sold at exchange stores and dispensed directly into vehicles owned by eligible patrons.
“As part of my unwavering commitment to America’s military heroes and keeping my promise to improve service members’ lives, I introduced legislation authorizing a fuel discount at military exchange pumps to lower living costs for our troops, veterans, and dependents,” stated Congressman Hamadeh.
The bill would allow the Secretary of Defense to provide a base discount on gasoline and diesel fuel equal to the federal fuel tax rate, which is at least 18.4 cents per gallon for gasoline and 24.4 cents per gallon for diesel. It also authorizes supplemental discounts to help offset state and local fuel taxes when applicable.
These costs disproportionately impact military families, veterans, and retirees, who often face long commutes to bases, training facilities, work, or VA medical appointments. With inflation and rising transportation costs continuing to strain household budgets, many service members spend a significant portion of their income on fuel.
Discounts would be applied automatically at the time of sale to the maximum extent practicable. The authority for the program would terminate on September 30, 2029.
The legislation includes safeguards to prevent fraud or abuse, prohibits the resale of commercial use of discounted fuel, and requires the Secretary of Defense to submit annual reports to Congress detailing program usage, costs, gallons sold, and any implementation issues.
“Fuel is one of the few products sold by exchanges still subject to tax,” added Hamadeh. “This discount, equal to the federal fuel tax, shows profound gratitude to our nation’s heroes who have borne the heavy costs of war defending our freedoms. This common-sense step delivers real relief to our selfless service members and their families.”
Ethan Faverino is a reporter for AZ Free News. You can send him news tips using this link.
Retail sales increased for the seventh consecutive month in April, highlighting the resilience of American consumers despite rising gas prices and elevated inflation.
According to the CNBC/NRF Retail Monitor, total retail sales excluding automobile dealers and gas stations increased 0.34% seasonally adjusted from March and rose 5.73% unadjusted from April of 2025. That follows gains of 0.4% month-over-month and 6.59% year-over-year in March.
“Retail sales continued to grow in April despite higher gas prices driven by the ongoing conflict in Iran, cautious consumer sentiment and the persistent concerns about sustained inflation,” stated NRF President and CEO Matthew Shay.
Core retail sales, which also exclude restaurants, posted a smilier 0.34% month-over-month gain and climbed 5.53% year-over-year. For the first four months of 2026, total sales were up 6.07% year-over-year, while core sales rose 5.99%.
Sales growth was broad-based, rising in eight of nine major categories on a yearly basis and in all but one category on a monthly basis. Clothing and accessories stores led the way with a 0.59% month-over-month increase and a strong 9.75% year-over-year gain.
Sporting goods, hobby, music and book stores advanced 0.12% month-over-month and 8.55% year-over-year, while health and personal care stores rose 0.45% and 8.42% respectively. Digital products, including electronic books and games, posted the strongest monthly gain at 1.11% and climbed 8.09% annually.
Other categories showing positive momentum included general merchandise stores (up 0.15% month-over-month and 6.19% year-over-year), electronics and appliance stores (up 0.16% and 4.03%), and grocery and beverage stores (up 0.36% and 3.21%).
Furniture and homes furnishings stores saw a slight 0.06% monthly decline but still posted a 2.58% annual increase. Building and garden supply stores edged up 0.009% for the month but were down 2.74% from the prior year.
“Spending on household priorities remains solid, supported by a steady labor market, wage growth and a significant influx of cash from tax refunds,” added Shay. “While consumers are mindful on costs, retailers are working hard to keep everyday goods affordable for American families.”
Ethan Faverino is a reporter for AZ Free News. You can send him news tips using this link.
The City of Scottsdale has issued a Truth in Taxation notice advising residents that city officials may consider an increase in the primary property tax levy for fiscal year 2026-27 as part of the municipal budget process.
According to Scottsdale’s public notice and supporting budget documents, the city is proposing a primary property tax levy increase tied largely to Arizona’s statutory two-percent adjustment, while projecting that the primary property tax rate itself could decline due to growth in assessed property values.
The Arizona Daily Independentreported that Scottsdale is proposing an increase in primary property taxes of $681,888, or 1.70%, above the prior year’s levy level, excluding revenue generated through new construction and changes related to voter-approved bonded indebtedness or overrides.
Scottsdale’s published notice states that the city “may increase” its primary property tax levy over last year’s level and emphasizes that the notice itself does not mean a tax increase has been approved. Instead, the city said the notice reflects the possibility that the City Council could discuss and potentially adopt a levy increase during the budget process.
According to the city, the current primary property tax rate of $0.4891 per $100 of assessed valuation could decrease to as low as $0.4801 as rising assessed property values offset portions of the proposed levy increase.
City budget documents show Scottsdale’s proposed FY 2026-27 primary property tax levy totals approximately $41.29 million, an increase of about $1.02 million over the current fiscal year’s $40.27 million levy. City officials reported the increase is primarily attributable to the statutory two-percent adjustment and includes repayment to the Risk Management Fund for tort liability claim payments made during calendar year 2025.
Scottsdale’s proposed secondary property tax levy, which is used for repayment of voter-approved general obligation debt, is also forecast to increase. According to city documents, the proposed secondary levy would rise from $34.85 million in FY 2025-26 to $36.70 million in FY 2026-27 due to increased debt service obligations.
Despite those levy increases, Scottsdale projects the combined city property tax rate could decrease from $0.9124 to approximately $0.9068 per $100 of assessed valuation because of growth in the city’s net assessed property values. City officials estimate that a homeowner with an assessed property value of $100,000 would pay approximately $90.68 in combined city property taxes under the proposal.
The city has scheduled a Truth in Taxation hearing, Property Tax Public Hearing, and Municipal Streetlight Improvement District hearing for June 9 at 5 p.m. at Scottsdale City Hall Kiva, located at 3939 N. Drinkwater Boulevard. Meetings will also be broadcast on Cox Cable Channel 11 and streamed through Scottsdale’s website.
Following those hearings, Scottsdale officials plan to consider formal adoption of property tax ordinances during the City Council meeting scheduled for June 23.
