Index Steady as Small Businesses Say High Inflation Still Top Concern

Overall, the survey—conducted between October 11-27, 2022—shows a remarkable consistency with findings last quarter across nearly all the questions that comprise the Index. This consistency reflects continued feelings of uncertainty about the broader economic environment that small business owners face.

Small business owners say inflation remains the top challenge (53%) for the fourth consecutive quarter, having jumped 30 percentage points since this time last year. Additionally, roughly four in five say rising prices have had a significant impact on their business this year, a consistent share for the third consecutive quarter. Meanwhile, concerns over supply chain issues have slightly cooled, shifting six percentage points down from last quarter (20% vs. 26%, respectively).

The upcoming holiday season is increasingly pivotal for small businesses’ overall profit, but there may be increased anxiety about it, especially for retailers. About eight in ten small businesses say the upcoming holiday season is important for their overall profit, a nine-percentage-point increase compared to this time last year (Q4 2021). Three in five say they expect less revenue than usual this holiday season.

Finally, most small businesses report giving back to their local communities. Two-thirds of small businesses (66%) say they have donated to local charities over the past year. While over half say they have encouraged employees to shop at local small businesses (70%), sponsored or donated goods/services to local events (64%), or offered discounts to certain groups within the community (56%). Furthermore, nine in ten say businesses should give back to their local communities, and four in five say they have a clearly defined mission that includes giving back. Likewise, about nine in ten (93%) report having taken at least one step to engage with their community in the past year.