Confidence in Economy Grows Among Small Businesses

More small businesses are feeling optimistic about the economy, according to the latest MetLife and U.S. Chamber of Commerce Small Business Index.

The quarterly report found that 40 percent of businesses with fewer than 500 employees believe the U.S. economy is in good health, while 46 percent said the same of their local economies — an improvement of 6 percent and 5 percent, respectively, from Q2 2025. At the same time, more small businesses said they were very comfortable with their cash flow (31 percent now versus 23 percent in Q2) and 69 percent said they expect revenue to increase over the next year.

The rising optimism pushed the overall index to 72.0, up from 65.2 the previous quarter and a new record high for the index. “This quarter’s index reflects a resilient small business community that’s cautiously optimistic about the economy,” said Tom Sullivan, vice president of small business policy at the U.S. Chamber of Commerce. “But high costs are still holding many back from expanding and investing.” 

While overall sentiment is improving, small businesses remain concerned about inflation. Thirty-four percent of respondents said the cost of goods and services is the biggest roadblock to expansion while 33 percent said they were unable to enter new markets due to rising costs. Further, 75 percent of businesses report being significantly impacted by rising prices in the past year, and 65 percent said they have increased prices on their own products or services.

Another challenge has begun to gain ground in the Small Business Index: attracting talent. This quarter, 14 percent of small business owners cited talent acquisition as a top concern, an increase from 6 percent in Q4 2024.

“This quarter’s record-high index score reflects the resilience and optimism of small businesses, even as they face rising costs,” said Bradd Chignoli, executive vice president and head of regional business and workforce engagement at MetLife. “With nearly half of small businesses citing inflation as their biggest challenge, it’s clear that economic pressures persist. At the same time, we’re seeing attracting employees as a growing concern. Our data shows that in this environment, investing in people through training, relevant benefits packages and personalized communications is not just a response to current challenges; it can be a strategy for long-term growth and stability.”   

The full Q2 2025 Small Business Index is available here.