Small Business Outlook: Cautious Optimism Continues

Confidence remains high among small businesses and growth expectations are tempered by uncertainty.

Supreme Court Tariffs Decision: While we will learn more about the refund process in the days ahead, this guide provides information to help small businesses identify whether they paid IEEPA‑based tariffs and prepare for the emerging refund process.

Navigating the New Tax Law: Don't miss our practical guide to maximizing savings for your small business under the “One Big Beautiful Bill Act.”

ICYMI: As the United States approaches its 250th anniversary, U.S. Chamber of Commerce President and CEO Suzanne P. Clark unveiled a bold vision for how the business community can help shape the nation’s next chapter. Watch here.

New Small Business Data

GoDaddy Small Business Research Lab Report (March 3, 2026)

Summary: Sustained growth in new business formation moves in tandem with sustained GDP growth.

• 1% increase in establishment births is associated with 0.18% higher GDP growth, 0.16% higher payroll job growth, and a 0.15% decline in unemployment.
• One new technology-based small business in a zip code is associated with 2.9 more local payroll jobs and has a multiplier effect of 0.3 new establishments.

Paychex February Small Business Employment Watch (March 3, 2026)

Summary: Midwest continues to rank highest for small business job and wage growth.

• Paychex’s Small Business Jobs Index declined 0.53% since January and has declined 1.27% compared to February last year.
• The Midwest is the top region for small business employment growth since May 2024.
• Paychex’s Small Business Wage Data rose 0.04% since January and rose 2.78% compared to February last year.
• The Midwest ranks strongest for hourly earnings growth (3.08%) since August 2025.

Fiserv February Small Business Index (March 3, 2026)

Summary: Consumer spending remains steady.

• Month-over-month sales at small businesses increased slightly in February (+0.2% change) and year-over-year sales at small businesses continued to go up (+1.2% change) compared to February 2025.

2026 Report on Employer Firms from the Federal Reserve 2025 Small Business Credit Survey (March 3, 2026)

Summary: Revenue and employment growth on Main Street generally remained steady from 2024-2025 and expectations for future growth declined.

• 57% of small business owners viewed reaching customers and growing sales as their top challenge in 2025 followed by 46% who reported challenges with finding, hiring, and retaining workers.
• 48% of small firms reported sourcing from companies outside the U.S. and 84% of those firms reported input price increases throughout 2025.
• 31% of small business owners reported they were debt free and 59% of small businesses with debt secured it with a personal guarantee.
• 42% of small businesses received the amount of financing they wanted in 2025 and small business applicants at small banks were most likely to be fully approved for the requested financing (57%) compared to other lender types.

Small Business Fast Facts

Small Business Data Center

Read more

National Federation of Independent Business Industry Specific Report (February 25, 2026)

Summary: From November 2025 to January 2026, small business optimism increased in manufacturing, retail, and services, but dropped in the construction sector due to a deterioration in hiring plans.

• 21% of small businesses in construction plan to hire in the next 3-months (14 points lower than last quarter) and 23% expect sales to increase (5 points higher than last quarter).
• 20% of small construction firms (compared to 15% of all firms) believe now is a good time to expand (no change from last quarter).
• 24% of small businesses in manufacturing plan to hire in the next 3-months (no change from last quarter) and 24% expect sales to increase (18 points higher than last quarter).
• 19% of small manufacturers (compared to 15% of all firms) believe now is a good time to expand (4 points higher than last quarter).
• 8% of small businesses in retail plan to hire in the next 3-months (3 points higher than last quarter) and 16% expect sales to increase (11 points higher than last quarter).
• 7% of small retailers (compared to 15% of all firms) believe now is a good time to expand (1 point less than last quarter).
• 16% of small businesses in the services sector plan to hire in the next 3-months (2 points higher than last quarter) and 18% expect sales to increase (21 points higher than last quarter).
• 13% of small service firms (compared to 15% of all firms) believe now is a good time to expand (4 points higher than last quarter).

Small Business & Entrepreneurship Council Check Up Survey (February 24, 2026)

Summary: Inflation remains top of mind for small business owners and a majority of Main Street employers expect a positive 2026.

• 71% of small business owners reported their 2025 financial performance was better than 2024.
• 92% of small business owners reported that they are currently stable or growing.
• 61% of small business owners have experienced positive cash flow effects from the new tax law and 73% of small business owners believe they will receive tax savings this tax season.
• 48% of small business owners view the current economic climate as good or excellent and 52% believe their own businesses’ financial position will improve this year.
• 73% of small business owners remain concerned about inflation, with 46% of small business owners believe inflation has risen over the past 6-months and 51% believe it has eased.
• 62% of small business owners expressed concern over tariff policies and 11% report that tariffs have a significant negative impact on their businesses.
• 77% of small business owners report AI usage and 56% report that AI is creating new opportunities for their teams without reducing headcount.

WSJ/Vistage Small Business Small Business CEO Confidence Index (February 18, 2026)

Summary: Main Street confidence continues to rise and small employers remain cautious about expanding their workforce.

• 27% of small business owners say the economy has improved compared to a year ago (3 points higher than January) and 30% say the economy has gotten worse (4 points better than January).
• 36% of small business owners believe the economy will improve in the next 12 months (2 points higher than January) and 21% believe the economy will worsen (2 points better than January).
• 55% of small businesses plan on increasing employees in the next 12-months (5 points higher than January) and 9% plan on decreasing employees (2 points higher than January).
• 34% of small businesses are expecting to increase fixed investments (2 points higher than January) and 50% expect fixed expenditures to remain the same.
• 71% of small businesses expect increased revenues in the next 12 months (4 points higher than January) and 8% believe revenues will decrease (2 points better than January).
• 60% of small business owners believe profitability will increase in the next 12 months (4 points higher than January) and 8% believe that profitability will decrease (5 points better than January).
• 49% of small business owners anticipate tax savings from the new tax law and 33% do not.

Honoring America's Top Small Businesses

Celebrating America's Top 100 Small Businesses

Read more

2025 OnDeck + Ocrolus Small Business Q4 Cash Flow Trend Report (January 28, 2026)

Summary: Main Street confidence continued to steadily rise throughout 2025 as did AI adoption.

• 94% of small businesses anticipate moderate to significant growth over the next year (1 point higher than last quarter) and 29.1% anticipate significant growth (1.9 points lower than last quarter).
• 31% of small business owners cite Inflation as their highest concern (1 point higher than last quarter).
• 60.7% of small business owners will pay down existing debt with any excess cash flow realized from 2025. 18.8% will build cash reserves. 6.6% will increase capital investments. 4.3% will increase marketing or customer acquisition spending. 3.4% will hire more staff and 2.6% will raise wages.
• 44% of small business owners reported changing their business operations to mitigate negative impacts caused by tariffs. The most common changes were passing along price increases to customers (30.3% of those who changed operations), seeking alternative suppliers (13%), and adding products or services (9.4%).
• 56% of small business owners have incorporated Artificial Intelligence (AI) into their operations (4 points higher than last quarter).

MetLife & U.S. Chamber of Commerce Small Business Index for Q4 (December 10, 2025)

Summary: Index shows a dip in confidence, revenue expectations, cash flow, and plans for investment. Inflation remains the top concern albeit trending downward. Note: Survey was in the field during the government shutdown.

• 70% of small businesses are confident in the health of their own business (2 points lower than last quarter) and 74% are comfortable with their current cash flow (2 points lower than last quarter).
• 43% of small business owners are positive about the health of their local economy (3 points lower) and 28% are negative (4 points worse than last quarter).
• 38% of small business owners are positive about the nation’s economic health (2 points lower than last quarter) and 44% are negative (2 points worse than last quarter).
• 45% of small business owners rank inflation as their top concern (1point lower than last quarter and the 16^thconsecutive quarter where inflation tops the list).
• 65% of small business owners expect to increase revenue in the next year (4 points lower than last quarter).
• 23% of small business owners reported adding staff over this past year (5 points less than last quarter) and 68% reported keeping the same number of staff (4 points higher than last quarter).
• 42% of small business owners expect to increase staff in the next year (2 points lower than last quarter) and 49% expect to maintain current staffing levels (3 points higher than last quarter).
• 17% of small business owners cited employee retention as their top concern (highest level in 8 ½ years).

Explore More Small Business Insights

The U.S. Chamber's SVP of Small Business Policy Tom Sullivan appears regularly on ASBN - America's Small Business Network and hosts a weekly podcast to deliver fresh insights on small business to viewers and listeners nationwide.

Watch Tom Sullivan talk all things small business with Jim Fitzpatrick on ASBN (America's Small Business Network), including the latest news and policy updates for Main Street business owners. New episodes are added every month so that you can watch them anytime.

Small Business Outlook Podcast

About the author

Thomas M. Sullivan

Thomas M. Sullivan is senior 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.

Read more