Detroit City Wire

Small business confidence in the United States has reached a new high, according to the latest MetLife and U.S. Chamber of Commerce Small Business Index for the third quarter of 2025. The index score rose to 72.0, up from 65.2 in the previous quarter, reflecting improved perceptions of both national and local economic conditions.

Despite this increased optimism—especially regarding cash flow and economic outlook—many small businesses continue to face significant challenges due to inflation and rising costs. Tom Sullivan, Vice President of Small Business Policy at the U.S. Chamber of Commerce, stated: “This quarter’s Index reflects a resilient small business community that’s cautiously optimistic about the economy. But high costs are still holding many back from expanding and investing.”

The survey found that 31% of small businesses now feel very comfortable with their cash flow, an increase from 23% last quarter. Additionally, 40% believe the U.S. economy is in good health, while 46% hold a positive view of their local economies—both figures higher than those reported in Q2.

However, inflation remains a top concern for many entrepreneurs; 46% identified it as their biggest challenge, and three-quarters said rising prices have significantly affected their operations over the past year. High costs are also limiting growth opportunities: 34% cited the cost of goods and services as a primary obstacle to expansion, while another 33% said these expenses prevent them from entering new markets.

Victoria Thomas, Principal and Chief Business Officer at Kellymoss Racing in Fitchburg, Wisconsin, commented on her experience: “Our area benefits from a strong base of technology, manufacturing, and small businesses. While we see some of the national headwinds in tariff concerns and labor shortages, overall, the demand for our product is steady and the entrepreneurial environment here continues to support growth,” says Thomas.

While inflationary pressures and supply chain disruptions appear to be easing somewhat for small businesses, attracting talent has become an increasing concern this quarter. Fourteen percent of respondents named talent acquisition as a top issue—a notable rise from just six percent at the end of last year.

Bradd Chignoli, executive vice president and head of Regional Business & Workforce Engagement at MetLife said: “This quarter’s record-high Index score reflects the resilience and optimism of small businesses, even as they face rising costs. With nearly half of small businesses citing inflation as their biggest challenge, it’s clear that economic pressures persist. At the same time, we’re seeing attracting employees as a growing concern. Our data shows that in this environment, investing in people through training, relevant benefits packages, and personalized communications is not just a response to current challenges, it can be a strategy for long-term growth and stability.”

The survey also explored where small business owners are directing investments this quarter. Marketing and sales initiatives remain priorities alongside customer experience improvements and inventory management efforts. There is also continued investment in technology—with younger business owners more likely to focus on online customer experience enhancements as well as adopting new technologies such as artificial intelligence (AI).

Among those investing in technology:

- Sixty percent are prioritizing business software,

- Thirty-six percent are focusing on AI,

- Thirty-two percent report investments in data management or analytics,

- Twenty-seven percent cite cybersecurity software as an area of focus.