US small firms show mixed confidence despite persistent inflation concerns
Small businesses, which employ about half of US workers and produce roughly half of its GDP, appear more confident than the wider public’s poor economic mood might suggest. Their views matter politically because owners and employees are a significant voting group ahead of November’s midterm elections, but the mixed survey results offer no clear sign that confidence will improve Donald Trump’s low approval ratings.
The National Federation of Independent Business found optimism just below its long-term average, with labour quality and inflation the leading concerns; 17% of owners plan to add jobs. A separate survey found 72% were comfortable with their cash flow, though only 27% thought the economy was healthy and 54% cited inflation as their biggest problem. Employment estimates differed: Gusto reported 28,000 small-business jobs added in September, while Intuit found a fall of 7,000 among firms with one to nine employees; other measures pointed to broadly steady hiring.
- Small-business confidence is holding up despite wider economic pessimism.
- Inflation remains owners’ biggest concern.
- September job estimates vary across data providers.
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Small businesses employ about half of US workers and produce roughly half of the country’s economic output. Their views can offer clues about hiring and spending, while their owners and employees are a sizeable group of voters.
Surveys measure different things, such as owners’ plans, cash flow and views of the wider economy, so their results can vary. Inflation and finding suitable workers have been recurring concerns for small firms.
Small-business confidence is one part of the broader economic picture. It can help explain how firms are responding to costs and demand, but it does not by itself show how the whole economy is performing or how voters will decide.
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The case for
The surveys suggest many small firms remain resilient: most respondents in one poll were comfortable with cash flow, and the NFIB found optimism only slightly below its long-term average, with some owners planning to hire. On this view, mixed hiring estimates and persistent inflation concerns do not erase signs that businesses are adapting and could sustain employment.
The case against
The results also point to fragile confidence: only a minority in one survey considered the economy healthy, inflation was the leading problem for many, and the NFIB’s optimism measure remained below its long-term average. Conflicting employment estimates, alongside differing plans to hire, make it difficult to treat the more positive findings as evidence of a broad or lasting improvement.
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Originally published by The Guardian as “Small business owners are doing OK – but will that help Trump overcome his low approval ratings?”.