U.S. small business owners see an improving economy and point to the Small Business Index released Wednesday as proof.
The Q3 MetLife and U.S. Chamber of Commerce Small Business Index reached its highest score since the start of the pandemic. Used to measure the confidence of small business owners, the Index score rose from 63.1 to 69.2, due to the number of small businesses believing the economy is in good shape.
According to the Index, 66% of small businesses report that their business is in good health and 72% state that they are comfortable with their cash flow. Both measures increased several points from last month.
“I think what we’re looking at now is trying to provide resources to help those businesses maintain that momentum and potentially scale and have our eyes on those big things such as rising interest rates and inflation,” said Ryan Unger, president and CEO of the Harrisburg Regional Chamber and CREDC. “I think those are the issues that could impact small business growth, so we want to make sure we can maintain that momentum going forward.”
Unger added that inflation, if unchecked, would drive up interest rates, inhibiting the ability of small businesses to scale and grow.
“I think we’ve got our eyes on those (factors) in the months ahead,” Unger said.
Tom Sullivan, vice president of Small Business Policy at the U.S. Chamber of Commerce, cited the resiliency of main street employers.
“With fears of a recession likely in the rear-view mirror and inflation starting to ease, small business owners are feeling a lot better than they were a year ago,” Sullivan said in a statement.
Inflation and employee retention remain among the leading concerns for small business owners, according to a survey this quarter. Small business owners added that keeping pace with employees’ salary expectations is also a challenge.
At the same time, small business owners point to what they feel are the unique benefits and advantages they can offer to employees. Nearly nine in 10 employers said in this quarter’s survey that their company feels like a family and that this environment has aided them in retaining employees. Roughly 82% of employers surveyed said small businesses are uniquely qualified to provide employees with connections to and support from upper management.