Published
April 07, 2026
The latest U.S. Chamber of Commerce Small Business Index shows small businesses cutting back on plans for hiring and investment as their concerns about inflation grow.
This quarter, the Index score fell to 67.0, down from 68.4 last quarter, marking a continued pullback from its recent high of 72.0 in Q3 2025.
While the overall score remains above this time last year, the underlying data point to a sharper deterioration in sentiment—particularly around the national economy, future investment, and hiring.
Inflation and Affordability Concerns Are Top of Mind
Inflation is the top challenge facing small businesses, with 53% of those surveyed citing it as their biggest concern—up from 45% last quarter. Inflation has now been the leading challenge for 17 consecutive quarters, spanning more than four years.
These findings come as Americans across the country are feeling the strain of higher prices—for groceries, housing, insurance, health care, and energy. Policy reform can help lower these costs.
The Chamber recently offered some suggestions as to how policymakers can improve affordability in key areas by reducing permitting delays, expanding tariff relief, and decreasing regulatory complexity.
More See a Fragile Economy
The Q1 data also reveal a notable divergence between how small businesses view their own operations and how they assess the broader economy. Nearly seven in ten small business owners (69%) continue to rate their business as being in good health.
However, views of the national and local economies have weakened considerably.
Only 28% of small business owners say the U.S. economy is in good health—down 10 points from last quarter—while 35% say their local economy is in good health, an 8-point decline. These readings are in line with levels seen a year ago.
“The biggest challenge facing our business right now is financial uncertainty in the economy which is causing tightening on discretionary spending,” said Chris Barber, a member of the U.S. Chamber’s Small Business Council and Chief Nerd at Cheaper Than A Geek.
Small Businesses Pull Back on Future Investment, Hiring
The general uncertainty and concerns about the economy are having a real impact on small business planning. Significantly fewer small businesses say they plan to expand payrolls or make new investments in the year ahead:
- 37% expect to increase investment, down from 44% last quarter.
- Just 30% expect to increase staff, a 12-point drop from Q4 2025.
- 61% expect increased revenue, slipping from 65% last quarter and 69% a year ago.
The pullback in expectations underscores concerns that economic uncertainty is beginning to weigh on growth decisions—an early warning sign for broader economic momentum.
The survey was conducted largely after the outbreak of military conflict with Iran, from February 25–March 11, 2026. For more findings from this quarter, and to explore years of small business data, visit here.
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About the author
Thaddeus Swanek
Thaddeus is a senior writer and editor with the U.S. Chamber of Commerce's strategic communications team.
