According to the U.S. Chamber of Commerce’s Small Business Index, small businesses lost confidence in the country’s economy, falling to 61.3 in the fourth quarter from 69.2 in the third.
The Index, put out by the U.S. Chamber and MetLife, measures small business owner confidence. The Q4 Index reflects a return to scores seen earlier this year and late 2022. Officials said the Index reflects small businesses’ view of the national economy and their local economies. Only 25 percent of small businesses responding to the survey said they U.S. economy is in good health, while only 30 percent said their local economy is in good health. Both views are down eight percentage points since the last quarter.
But small businesses’ views remain positive when it comes to the health of their own businesses. About two thirds (64 percent) said the health of their own business is very good or somewhat good. And two thirds said they were somewhat or very comfortable with their current cash flow – down just five percentage points from last quarter, and consistent with the feeling during the same time last year.
“With inflation still outpacing revenue expectations, small business owners are wary of the future and continue to have an overall negative impression about the national economy,” Tom Sullivan, vice president of small business policy at the U.S. Chamber of Commerce, said. “At the same time, holiday shopping is already setting records this year and most small businesses say they are doing okay despite persistent headwinds.”
Small businesses were concerned with inflation, the Index found, as well as the ongoing worker shortage and being able to keep up with salary expectations.
“As small business owners report challenges attracting and retaining employees, it is important to consider the recruiting tools beyond just salary and understand the powerful role benefits can play,” Cynthia Smith, senior vice president of regional business at MetLife, said. “A robust voluntary benefits program can offer employees personalized benefits to meet their specific needs without adding cost.”