The MetLife and U.S. Chamber of Commerce Small Business Index celebrates five years of publication this quarter. In honor of this milestone, they offer a look back at five years of small business trends, the major challenges small business leaders have faced, and how small businesses feel about the future.
The Small Business Index is a premier tracker of U.S. small business sentiment and perspectives. Reports are released quarterly, compiled from 750 unique interviews with small business owners and operators, delivering a comprehensive quantitative snapshot of the small business sector.
Over the last five years, one key finding stands out: in a post-pandemic world with major labor shortages, small business owners report working longer hours than they used to.
In fact, half (50%) of small business owners say they are working more hours now than they were a year ago. This question was first asked at the inaugural SBI (second quarter 2017). Five years ago, 30% said they were working more hours. This equates to a very significant 20 percentage point increase in the share of small business owners who report working more hours.
This quarter, small businesses say inflation is by far their top concern. Forty-four percent of the small businesses surveyed cite inflation as the biggest challenge they face, up from 33% last quarter. This is significantly higher than the 19% reported when the question was first asked in the third quarter of 2021.
Furthermore, nearly nine in ten (88%) are concerned about the impact of inflation on their business, with almost half (49%) indicating they are very concerned; up from 44% in first quarter 2022 and 31% in fourth quarter 2021.
To keep up, many small businesses report raising prices. A strong majority (69%) report raising the prices of their products or services due to inflation in the past year. This is consistent with the 67% that reported raising their prices due to inflation last quarter. Nearly half of those surveyed (46%) report having taken out a loan to cover higher costs due to inflation, up from 39% in the first quarter of 2022.
Looking ahead to next year, 43% of small businesses intend to increase their staff—an increase of six percentage points from last quarter. Meanwhile, 43% anticipate they will invest more over the next year, and 66% expect revenues to increase, both on par with first quarter 2022 surveys.
One striking thing about small business owners over the past five years is their steady optimism that things will improve in the future regardless of the challenges thrown at them. It takes a lot of grit, determination, and hard work to start and sustain any small business. If anything, the SBI has graphically demonstrated something else small business leaders possess that sets them apart: relentless optimism.
For more findings from this quarter, and to explore and browse years of small business data, visit uschamber.com/sbindex/.
Please join us in welcoming the following new Chamber member:
Kansas Turnpike Authority: Contact Tegan Blake at 316-591-7917 or visit them online at ksturnpike.com.
It’s a great day in Emporia!
“Let’s Talk Business” is a weekly column of the Emporia Area Chamber of Commerce and Visit Emporia. The mission of the Chamber is to be proactive in creating an environment for business and community success, guided by the vision that positive attitudes promote positive actions. Contact us at 620-342-1600 or firstname.lastname@example.org and visit our website at www.emporiakschamber.org