Thomas M. Sullivan
Vice President, Small Business Policy, U.S. Chamber of Commerce


September 25, 2023


We track the latest data on the small business outlook so that you don't have to. Every week, Tom Sullivan analyzes new data from NFIB, Intuit, WSJ/Vistage, and more, to give a weekly economic forecast for small businesses.

The Latest Forecast

Sunny and pleasant on Main Street, but a three-cloud tropical storm is brewing off the coast and may turn into a full-blown hurricane.

  • What it means: Data on small business shows a remarkable resiliency by Main Street employers.  Comfort with cash flow and revenues are near pre-pandemic levels.  On top of high inflation, worker shortages, and high interest rates, three storm clouds are threatening. Those storm clouds are rising gas prices, labor union strikes, and an impending government shutdown. No wonder small business owners’ positivity about their own operations turns negative when asked about the national outlook.

Listen: Tom Sullivan and National Federation of Independent Business (NFIB)'s Holly Wade talk about their small business forecasts on a weekly podcast. Listen here.

Watch: Catch Tom Sullivan on ASBN (America's Small Business Network) every month providing the latest small business policy updates, news, and analysis. Watch here.

Coming Soon: The next MetLife & U.S. Chamber Small Business Index release is mid-December, 2023.

New Small Business Data

MetLife & U.S. Chamber of Commerce Small Business Index for Q3 (September 20, 2023)

Summary:  An uptick in feelings about the local and national economy bodes well for small business owners.

  • Index score is 63.1 (up 6.1 points from Q2 of this year).  This highest level is mostly attributed to a 9-point increase in small businesses’ comfort with their current cash flow and a 6-point increase in how they rate their overall business health.
  • While more small businesses are negative about the U.S. economy (43%) than positive (33%), the intensity of negativity is lessening (14 points lower than last quarter).
  • 52% of small business owners rank inflation costs as top concern (down 2 points from last quarter and 7 consecutive quarters as top concern) and when asked about inflationary pressures, small business owners are primarily worried about wage hikes (56%).
  • 42% of small businesses plan on increasing investment over the next 12-months (unchanged from last quarter) and 40% of small businesses plan on adding staff (down 7 points from last quarter’s 5-year-high).
  • 71% of small businesses plan on increased revenues in the next 12-months (unchanged from last quarter’s record-high).
  • 70% of small businesses report that rising interest rates are limiting their ability to raise capital (down 6 points from last quarter).
  • Twice as many small businesses view employee retention as a top challenge comparted to 2-years ago (15% vs. 7% if Q3 2021).
  • 70% of small business owners are prioritizing the mental health of their employees (up from 60% in Q3 2021).
  • 89% of small business owners believe their family-like atmosphere helps retain employees and 82% believe the direct connection between owners and employees gives small businesses an advantage when it comes to hiring and keeping good employees.

SBE Council Small Business Check Up Survey for Q3 (September 12, 2023)

Summary:  Revenues up, but inflation is outpacing sales and dampens small business outlook.

  • 57% of small business owners rank inflation as their top concern.  89% are concerned about inflation over the next 12-months and “economic uncertainty” ranks second in the list of concerns.
  • 63% of small business owners have steady or increased sales and 52% report that revenues have not kept pace with rising inflation.
  • 88% of small business owners rate the current economy as average to excellent, but 61% anticipate worsening economic conditions for the rest of the year.  59% of small business owners are reducing spending to prepare for an economic downturn.
  • 49% of small business owners are “satisfied” with federal policies intended to help small business and 45% are “dissatisfied.”
  • 48% of small businesses are experiencing labor shortages that hamper their operating capacity.
  • 31% of small businesses plan on adding employees in the next 6-months, with businesses in the West and South leading the pack (35% and 31% respectively).
  • 72% of small business owners are optimistic about their business’s survival over the next 2-years.

National Federation of Independent Business (NFIB) Small Business Optimism Index (September 12, 2023)

Summary: Outlook on economic improvements took a hit in August and worker shortage headwinds continue.

  • 24% of small business owners cited labor quality as their single biggest problem in August, with inflation running a close second (cited by 23% as biggest problem).
  • 27% of small businesses raised their prices in August (up 2 points from July).
  • -14% of small business owners reported higher sales in the past 3-months (1 point worse than July) and the percentage expecting higher sales dropped 2 points to -14%.
  • -37% of business owners are expecting better business conditions (7 points worse than July).
  • 56% of small business owners reported capital outlays in the last 6-months (up 1 point from July) and 24% are planning capital purchases in the next 3-months (down 3 points from July).
  • 40% of small business owners report job openings they cannot fill (down 2 points from July) and 17% plan on hiring in the next 3-months (unchanged from July).
  • 36% of small businesses raised compensation (down 2 points from July) and 26% plan on raising compensation in the next 3-months (up 5 points from July).
  • 27% of small business owners reported all their credit needs were met (up 2 points from July).  59% said they were not interested in a loan (down 3 points) and 2% of small business owners reported that their borrowing needs were not satisfied (down 1 point from July). 

Goldman Sachs 10,000 Small Business Voices Rural Survey(September 8, 2023)

Summary: Small businesses in rural America are poised for growth, but worker shortages are exasperated by the unique rural challenge of talent flight. 

  • 86% of rural small business owners currently have plans to grow their business.
  • 31% of small business owners think young people will stay in the community (versus 64% of non-rural).
  • Top challenges facing rural small business owners are access to affordable high-quality child care programs (74%); affordable housing options (71%); access to capital (68%); high-quality healthcare (23%); and reliable high-speed internet (21%).
  • 58% of rural small business owners feel there are not enough training opportunities to support the local workforce (versus 46% of non-rural).
  • 68% of rural small business owners agree it’s a challenge to attract workers (compared to 46% of non-rural).

WSJ | Vistage Small Business Confidence Index (August 30, 2023)

Summary: Small businesses’ confidence remains high, but negativity towards future economic conditions abounds. 

  • 33% of small business owners believe the United States is approaching a recession and 17% believe we are already in a recession.
  • 38% of small business owners expect the economy to worsen in the next 12-months compared to 15% who believe the economy will improve.
  • 54% of small business owners are expecting increased revenues in the next 12-months (down 1 point from July) and 42% expect higher profits (up 2 points from July).
  • 47% of small businesses have implemented cost-cutting measures to save money and sourcing new vendors and suppliers tops the list of cost reductions (37%).

EIG Analysis of Census Bureau’s Business Formation Statistics: The Startup Surge Continues: Business Applications on Track for Second-Largest Annual Total on Record by Daniel Newman(July 24, 2023)

Summary: New business applications remain elevated, especially in Southern states.  Applications to start businesses in real estate, manufacturing, and transportation & warehousing are declining.

  • High propensity (likely to hire employees) applications to start a new business increased by 7% in the first half of 2023 compared to the first half of 2022.
  • The nearly 871,000 applications in sectors likely to hire employees represent a 36% increase over the pre-pandemic mid-year baseline.
  • The strongest year-over-year growth in business applications is in healthcare, retail, arts & entertainment, and accommodation & food services.
  • 7 out of the 10 leading states in new business applications since 2019 are in the South.
  • The 16.6 million new business applications filed since March 2020 total more than the combined total during the 5 years leading up to the pandemic.
  • If the current trend of new business applications continues, this year will be the second-highest total (2021 set the record with 5.4 million business applications).

Explore More Small Business Data

The MetLife & U.S. Chamber of Commerce Small Business Index is released quarterly to deliver a comprehensive quantitative snapshot of the small business sector and explore small business owners’ perspectives on the latest economic and business trends.

About the authors

Thomas M. Sullivan

Thomas M. Sullivan

Thomas M. Sullivan is vice president of small business policy at the U.S. Chamber of Commerce. Working with chambers of commerce and the U.S. Chamber’s nationwide network, Sullivan harnesses the views of small businesses and translates that grassroots power into federal policies that bolster free enterprise and reward entrepreneurship. He runs the U.S.

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