Updated
September 30, 2024
Published
December 12, 2023
This Week's Outlook: Inflation continues to dominate small business concerns and a labor strike at East Coast ports will only magnify Main Street’s frustration with high prices. Small business owners’ desire for political candidates to win their vote by addressing the economy is at an all-time high.
The Q3 MetLife & U.S. Chamber of Commerce Small Business Index was released last week with insights on the upcoming election and the economy. Be sure to check out why small business owners’ interest in the election has gained intensity over the past four years.
This Week's Top Takeaways
- The latest MetLife & U.S. Chamber of Commerce Small Business Index shows small business owners are more positive than negative about the economy, at least at the local level.
- Post-election optimism has leveled out and small business owners remain nervous about inflation.
- Prices remain high and shipping costs and supply chain woes from a labor strike at East Coast ports add to Main Street concerns.
Weekly Small Business Analysis
Every week, the U.S. Chamber's Vice President of Small Business Policy, Tom Sullivan, summarizes the latest data on small businesses from leading organizations, including CNBC, The Wall Street Journal, Intuit, and more, and explains what it all means for the health of America's small businesses and the national economy.
New Small Business Data
MetLife & U.S. Chamber of Commerce Small Business Index for Q3 (September 24, 2024)
Summary: Small business confidence takes a dip and stays more positive than negative at a local level. Main Street employers are following the election closely, expect elected leaders to compromise and get things done, and do not want the next Congress to raise their taxes.
- 35% of small business owners are positive about the nation’s economic health (decreased 1 point since last quarter) and 48% are negative about the U.S. economy (1 point more negative).
- 38% of small business owners are positive about the health of their local economy (decreased 5 points since last quarter) and 34% are negative about their local economy (7 points more negative than last quarter).
- 56% of small business owners rank inflation as their top concern (1 point higher than last quarter and the 11th consecutive quarter where inflation tops the list).
- 66% of small businesses are confident in the health of their own business (no change from last quarter) and 68% are comfortable with their current cash flow (5 point derease from last quarter).
- 22% of small businesses increased staff over the past year (no change from than last quarter and tied with the highest level reached 2-years ago) and 44% of small businesses anticipate increasing staff in the next 12-months (3 points higher than last quarter).
- 71% of small business owners are more interested in the upcoming election than 4-years ago.
- 84% of small business owners feel that partisan gridlock is a serious problem in Washington and 75% believe that political leaders should compromise to get things done (7 points higher than 4-years ago).
- 88% of small business owners said that it is very important the next Congress does not raise taxes on businesses.
Entrepreneur Small Business Owner Survey (September 18, 2024)
Summary: Small business owners are following the Presidential election closely and are mostly optimistic about 2025.
- 51% of small business owners report their business is doing better in 2024 than a year ago. 84% believe that 2025 will be better than this year and 48% anticipate a stronger economy.
- 43% of small business owners believe inflation will improve over the next 12-months, with 49% of the most optimistic group (owners under 44-years old (millennials)) anticipating that inflation will ease.
- 47% of small business owners surveyed are not recruiting new employees. Of those looking to fill open positions, 28% are offering higher wages, 19% are offering remote work options, and 16% are offering the ability to work fewer hours.
- Startup business owners report the highest stress levels (72%) compared to owners who have been in business for more than 6-years (58%).
- 81% of small business owners are following political news leading up to the election closely and any equal percentage of small business owners are optimistic the next President’s policies will help their business (40%) versus those who are skeptical (39%).
Honoring America's Top Small Businesses
U.S. Chamber Technology Engagement Center: Impact of Technology on U.S. Small Business (September 16, 2024)
Summary: Small business reliance on technology for growth is up fueled by AI.
- 99% of small businesses use at least one technology platform compared to 93% in 2022 and 95% in 2023. Social media platforms top the list (66%) followed by digital payments (57%) and accounting (56%).
- 85% of small businesses are confident that technology will help their businesses grow (up 3 points from 2023).
- 40% of small businesses are using generative AI (up 17 points from 2023) and marketing/promotions show most frequent use of generative AI (56%).
- 60% of small business owners believe AI will help their businesses (up 5 points from 2023).
- 54% of small business owners are worried that government regulation of technology would harm their business, with 78% worried that limiting access to AI will slow their ability to grow their business.
Looking for More Small Business Insights?
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.
MetLife & U.S. Chamber Small Business Index
This quarterly survey delivers a comprehensive quantitative snapshot of the small business sector and explores small business owners’ perspectives on the latest economic and business trends.
Goldman Sachs 10,000 Small Businesses Report on Rural Small Businesses (September 13, 2024)
Summary: Inflation and workforce challenges are hitting rural small businesses hard.
- Over 73% of rural small business owners believe their business has a meaningful impact on the local economy and on the social well-being of their community.
- 98% of rural small business owners report that the cost of doing business has increased over the past 5-years and 64% have experienced flat or decreased profitability.
- 62% of rural small businesses report that attracting workers to their community is a challenge and 35% are worried that young talent will leave. Lack of affordable housing tops the list of challenges rural small business owners face in recruiting and keeping good workers.
- 67% of rural small business owners have a positive view of the economy (fair to excellent) compared to 73% of non-rural small business owners.
National Federation of Independent Business (NFIB) Small Business Optimism Index (September 10, 2024)
Summary: Small businesses’ sales outlook plummeted in August and inflation remains top concern.
- 16% of small business owners reported higher sales in the past 3-months (unchanged from July) and the percentage expecting higher sales dropped 9 points since July to reach -18%.
- 24% of small business owners ranked inflation as their top concern (1 point lower than July and still the top cited problem) and 21% said that labor quality is their top concern (2 points higher than July).
- 20% of small businesses raised their prices in August (2 points lower than July) and 25% are planning on raising prices in the next 3-months (1 point higher than July).
- 56% of small business owners reported capital outlays in the last 6-months (up 2 points from July) and 24% are planning capital purchases in the next 3-months (up 1 point from July).
- 8% of small business owners expect better credit conditions in the next 3-months (down 1 point from July).
- 60% of small business owners are not interested in a loan (2 points lower than July) and 27% report borrowing on a regular basis (unchanged from July).
- 4% of small business owners reported that financing was their top problem in August (up 1 point from July).
Small Business Fast Facts
Fiserv Small Business Index (September 6, 2024)
Summary: Consumer spending continues to slowly trend downward and sales are still up compared to a year ago.
- Month-over-month sales at small businesses in August declined 0.3% compared to July and year-over-year sales at small businesses grew 1.6% compared to August 2023.
- Spending increases in August came from food manufacturing, performing arts, truck transportation, and businesses in the spectator sports sector.
- Spending decreases in August came from educational services, insurance, ambulatory healthcare, and specialty trade contracting.
Small Business Forecast: The Podcast
The U.S. Chamber of Commerce's Tom Sullivan and National Federation of Independent Business's Holly Wade summarize what’s going on with small businesses and provide their forecast every week on the Small Business Forecast: The Podcast.
From Main Street
About the authors
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.
