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Summary & Highlights

Inflation Remains Top Concern, with Future Expectations Mixed

A restaurant manager is doing some accounting

This quarter, the MetLife & U.S. Chamber of Commerce Small Business Index is 65.2, up from last quarter’s Index Score of 62.3, but still down from this time last year (69.5). Compared to last quarter, small businesses are more likely to report that their business is in good health and that they are comfortable with their cash flow. Additionally, concerns about inflation have receded from all-time highs. However, there are mixed perceptions about future expectations.

While small business owners are confident in their business operations—especially at the local level—small business owners seem to be hedging their bets longer term due to national economic uncertainty.

Small business views of future expectations vary. Slightly more small businesses expect to increase staff in the next year (42%) compared to last quarter (37%). However, while the number that expect to increase revenue (65%) is stable from last quarter, it is down compared to this time last year (73% in Q2 2024).

At the same time, small businesses are optimistic about current business conditions. Nearly three in four (73%) small businesses say they are comfortable with their cash flow, up seven percentage points from last quarter (66%). Additionally, confidence in business health has increased (69%, up from 63%).

This quarter, inflation continues to be the biggest challenge facing small business owners by far, although concern about inflation has dropped (from 58% last quarter to 48% this quarter). Other concerns have shifted, as more small business owners cite employee retention (16%, up from 11%) as a top challenge, as well as a slight shift in the number that say supply chain issues (17%, from 13%) are a top challenge. This marks the first time the level of concern for inflation has dipped under 50% since Q2 2022. Just over a quarter (27%) of small businesses cite revenue as a top concern (down from 35% last quarter). Both inflation and revenue had reached all-time highs in concern last quarter; both have seen significant declines this quarter as other challenges crop up.

73%
of small businesses say they are comfortable with their cash flow
73%
of small businesses say they are comfortable with their cash flow
Small Business Index score gauge
Q2 2025 SBI:65.2
The MetLife and U.S. Chamber of Commerce Small Business Index score for Q2 is 65.2. The Q1 2025 Index score was 62.3.

Also this quarter, a majority of small businesses (66%) say that figuring out what benefits to offer is challenging and a similar percentage (67%) wish they had outside help. This is a significant increase from Q1 2023.

The information landscape on benefits is scattered, with no one place being the dominant or primary source for small businesses searching for answers. The most common source of information is Google or other search engines, though just 32% of small businesses use search engines to receive this information. Slightly fewer turn to benefit provider websites (26%), asking employees about their preferences (26%), asking insurance or benefit brokers, consultants, or agents (21%), or other business owners (21%).

Lastly, views on employee benefits differ greatly by generation. Generally, businesses owned by younger generations view benefits differently and want more help with choosing and offering benefits. Gen Z/Millennials are more likely to report offering employee benefits, more likely to say these benefits have a range of uses, more likely to find it difficult to figure out what benefits to offer employees, and notably, more likely to wish they had outside help on employee benefits.

66%
say that figuring out what benefits to offer is challenging
66%
say that figuring out what benefits to offer is challenging
Small Business Index Score Q3 2021 - Q2 2025 line graph

Index Highlights

The MetLife and U.S. Chamber of Commerce Small Business Index score for Q2 is 65.2. The Q1 2025 Index score was 62.3. 

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Index score rises slightly

The Small Business Index is 65.2 this quarter, up from 62.3 last quarter, but still down from this time last year (69.5).
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Business health and cash flow optimism up

Nearly three in four (73%) small businesses say they are comfortable with their cash flow, up seven percentage points from last quarter (66%). Additionally, confidence in business health has increased (69%, up from 63%).
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Increased time and resources spent on compliance

40% of small businesses say they have increased time or resources spent on compliance, up significantly from both last quarter (33%) and Q2 2024.
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Inflation concerns recede from record high

Concern for inflation dropped from 58% last quarter to 48% this quarter, as concern over employee wellbeing/morale ticked up, and concern over supply chain issues shifted up slightly.
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A majority say inflation has had an impact

A majority of small businesses report rising prices have had an impact on them (70%) or that they have raised prices for their goods or services in the past year due to inflation (60%).
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Supply chain worries impact operations

Nearly half of small businesses (47%) report having to alter their business’ supply chain in the past six months. Thirty percent say they are unable to keep up with customer demand because of supply chain disruptions.
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Views of the economy improve slightly

One in three small businesses (34%) believe that the U.S. economy is in good health, up slightly from last quarter (29%) and on par with Q2 2024.
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Figuring out employee benefits can be a challenge for small businesses

Most small businesses say figuring out what benefits to offer full-time employees is difficult (66%) and say they wish they had outside help (67%). This is a significant increase from Q1 2023.
Learn more
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Younger business owners want help with choosing benefits

Gen Z and Millennial-owned businesses are more likely to find it difficult to figure out what benefits to offer employees (74%) and wish they had outside help when it comes to offering employee benefits (78%).
Learn more
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Index score rises slightly

The Small Business Index is 65.2 this quarter, up from 62.3 last quarter, but still down from this time last year (69.5).
Learn more
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Business health and cash flow optimism up

Nearly three in four (73%) small businesses say they are comfortable with their cash flow, up seven percentage points from last quarter (66%). Additionally, confidence in business health has increased (69%, up from 63%).
Learn more
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Increased time and resources spent on compliance

40% of small businesses say they have increased time or resources spent on compliance, up significantly from both last quarter (33%) and Q2 2024.
Learn more
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Inflation concerns recede from record high

Concern for inflation dropped from 58% last quarter to 48% this quarter, as concern over employee wellbeing/morale ticked up, and concern over supply chain issues shifted up slightly.
Learn more
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A majority say inflation has had an impact

A majority of small businesses report rising prices have had an impact on them (70%) or that they have raised prices for their goods or services in the past year due to inflation (60%).
Learn more
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Supply chain worries impact operations

Nearly half of small businesses (47%) report having to alter their business’ supply chain in the past six months. Thirty percent say they are unable to keep up with customer demand because of supply chain disruptions.
Learn more
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Views of the economy improve slightly

One in three small businesses (34%) believe that the U.S. economy is in good health, up slightly from last quarter (29%) and on par with Q2 2024.
Learn more
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Figuring out employee benefits can be a challenge for small businesses

Most small businesses say figuring out what benefits to offer full-time employees is difficult (66%) and say they wish they had outside help (67%). This is a significant increase from Q1 2023.
Learn more
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Younger business owners want help with choosing benefits

Gen Z and Millennial-owned businesses are more likely to find it difficult to figure out what benefits to offer employees (74%) and wish they had outside help when it comes to offering employee benefits (78%).
Learn more