Small-business confidence holds steady as cost concerns grow
Small-business confidence barely changed in the second quarter, but the details show owners becoming more cautious about costs, local conditions and investment.
The U.S. Chamber of Commerce released its Q2 2026 Small Business Index on July 15, reporting a score of 66.5, down slightly from 67.0 in the first quarter and up from 65.2 a year earlier. The reading suggests stability rather than a broad collapse in expectations. It also shows a widening gap between how owners view their own businesses and how they see the operating environment.
Owners remain positive about their businesses
Sixty-nine percent of surveyed owners said their business health was steady. Sixty-six percent expected revenue to increase over the next year, and 35% expected to increase staff.
Revenue expectations rose from 61% in the first quarter to 66%, while the share expecting to increase staffing rose from 30% to 35%. Those figures show that many owners still see room for growth.
But inflation was the top concern for 57% of respondents, up from 48% in the second quarter of 2025. Positive views of the local economy fell to 33%, compared with 41% a year earlier. Planned investment also weakened: 38% said they expected to increase investment, down from 47% a year earlier.
That combination points to measured confidence. Owners may expect sales and hiring to improve while delaying equipment purchases, expansion or other commitments that would reduce financial flexibility.
The survey measures sentiment, not audited performance
Ipsos released its findings on July 17 after conducting the survey online in English from May 19 through June 4, 2026. The poll included 750 small-business owners and operators age 18 and older across the continental United States, Alaska and Hawaii.
For the study, small businesses were defined as companies with 500 or fewer employees that were not sole proprietorships. Ipsos said the sample was drawn from partner online panels, weighted to reflect characteristics such as region, industry, business size, owner gender and minority ownership. Because it was an online non-probability poll, a conventional statistical margin of error does not apply. Ipsos reported a credibility interval of roughly plus or minus 4.4 percentage points for all respondents, or plus or minus 5.9 points after a design-effect adjustment.
The Chamber is a business advocacy organization, and its index is best used as a measure of owner sentiment and expectations rather than a complete measure of national small-business performance.
Producer prices keep pressure on margins
Federal price data help explain why inflation remains central to the survey. The Bureau of Labor Statistics reported on August 13 that final-demand producer prices were unchanged in July but rose 4.7% over the 12 months ending that month.
Prices for final demand excluding foods, energy and trade services also increased 4.7% over the year. PPI measures prices received by domestic producers. It does not equal the prices every small business pays or the inflation rate faced by consumers. Still, the data provide current evidence that price pressures remain part of the environment affecting suppliers, service providers and business margins.
Operating data are less upbeat
QuickBooks reported that small-business employment fell by 32,400 jobs in the second quarter, a 0.25% decline from the first quarter and the third consecutive quarterly decrease. Average quarterly revenue fell by $2,920, or 1.94%, after two quarters of revenue gains.
The QuickBooks Small Business Index is a company-produced measure based on accounting data and an extrapolated estimate of broader small-business activity. It does not cover the same companies or use the same definition of small business as the Chamber-Ipsos survey. Its results therefore provide a useful comparison, not a direct audit of the survey’s respondents.
Sales growth depended on higher tickets
Fiserv’s Q2 Small Business Index rose one point to 144. The company said sales growth depended heavily on higher average tickets, while foot traffic remained below the prior year. Restaurants remained a weak spot, especially limited-service dining.
That distinction matters for owners and consumers. Higher sales totals do not necessarily mean more customers or stronger underlying demand if shoppers visit less often but spend more during each transaction.
Fiserv identifies small businesses using Small Business Administration definitions and extrapolates its transaction data to estimate broader U.S. sales. The index is company-produced and does not measure Fiserv’s own performance.
What the mixed signals mean
The current indicators are mixed rather than directly contradictory. The Chamber-Ipsos survey captures sentiment and expectations. QuickBooks measures employment and revenue activity through accounting data. Fiserv measures sales and consumer behavior through payment transactions. Their firms, time periods, industry coverage and definitions are not identical.
Together, they suggest that small-business owners are not uniformly pessimistic, but their confidence is increasingly defensive and cost-sensitive. Inflation remains the clearest reported obstacle even as owners continue to expect better revenue and hiring. The gap between hiring and revenue expectations on one hand and investment plans on the other may indicate that some owners are trying to preserve flexibility rather than expand aggressively.
The next important test will be whether expected revenue growth and hiring translate into measurable gains, or whether weaker employment, revenue and foot-traffic readings continue. The available data do not establish a recession, widespread closures or a definitive national downturn; they show a business sector trying to remain optimistic while managing rising cost and demand risks.
Sources
- U.S. Chamber of Commerce Q2 2026 Small Business Index
- Bureau of Labor Statistics Producer Price Indexes, July 2026
- Ipsos Q2 2026 Small Business Index methodology
- QuickBooks Q2 2026 Small Business Employment and Revenue Trends
- Fiserv Q2 2026 Small Business Sales Growth and Consumer Spending Data
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