Small Business Confidence Holds Steady Despite Inflation Concerns

Nearly seven in 10 small business owners rated their company as being in good health (69%) in the latest U.S. Chamber of Commerce Small Business Index. That reading was consistent with Q1 2026 and up only 1 percentage point from a year ago, demonstrating the steady confidence owners have in their business.

The index stood at 66.5 for Q2 2026, nearly unchanged from last quarter’s 67. The mostly positive outlook has more businesses (66%) expecting to increase revenue in the next year, up from 61% last quarter. Similarly, 69% said they were comfortable with their cash flow, a slight drop from the 72% who said the same in Q2 2025 but still a strong majority.

Although business owners have faith in their companies, there are signs that many remain cautious. Only 38% of respondents reported that they plan to increase investment, a nearly 10-percentage-point drop from this time last year (47%). Hiring plans have also softened by 10% compared with a year ago, with only 35% of companies saying they expect to increase staff.

Those declines may correlate to rising inflation, which was the top concern for 57% of small businesses. When asked why they selected inflation as their top issue, many business owners cited the cost pressures on their business and lower disposable incomes among customers.

One factor that the U.S. Chamber noted may be lifting small business expectations is the rapid adoption of artificial intelligence. A new chamber survey found that small businesses using AI believe that it helps people work more efficiently, improves the quality of their work, and allows them to take on more challenging tasks.

“Small business owners are proving, once again, that they know how to adapt,” said Tom Sullivan, senior vice president of small business policy at the U.S. Chamber of Commerce. “Even with inflation topping the list of challenges, they are still confident in their own operations and expect more revenue growth and hiring in the year ahead. The message this quarter is one of measured confidence: small businesses are still looking ahead, even as they navigate a tougher cost environment.”

The full Q2 2026 Small Business Index is available here.