The MetLife & U.S. Chamber of Commerce Q2 2025 Small Business Index shows a slight increase to 65.2 from 62.3 in the previous quarter, indicating some optimism among small businesses regarding their health and cash flow. However, economic uncertainty remains a concern. The index is still below its levels from the last three quarters of 2024 due to a significant drop in Q1 2025.
Inflation concerns have decreased, with only 48% worried about it compared to 58% last quarter. Despite this, 70% of small businesses report that rising prices have affected their operations, and 60% have raised prices over the past year due to inflation. Additionally, more businesses (40%, up from 33%) are spending increased time on licensing and compliance.
"Small businesses are cautiously navigating a complex economic landscape," said Tom Sullivan, Senior Vice President of Small Business Policy at the U.S. Chamber of Commerce. "While they are confident in their business operations—especially at the local level—when it comes to long-term planning there is some hesitation as inflation concerns linger, and new trade policies create economic uncertainty."
The survey conducted between April 16 – May 5, 2025, indicates that while expectations for revenue growth have softened—with only 65% anticipating increases compared to 73% a year ago—42% expect to increase staff in the next year.
Supply chain disruptions continue to be an issue, with nearly half (47%) altering supply chains recently and 30% unable to meet customer demand due to these disruptions. Workforce issues are also growing; employee retention is now cited by more owners (16%, up from 11%) as a top challenge.
Generational differences show that Baby Boomer-owned businesses report lower confidence compared to Gen-Z and Millennial owners who remain more optimistic.
Colton McCurley, CEO of National Flooring & Supply Inc., noted his clients' loyalty but increasing cost-consciousness: "We are managing these headwinds through tight cost controls, vendor renegotiations, and strategic investments in automation and distribution."
The survey also explored employee benefits offerings among small businesses. While most recognize their importance for morale and retention—93% say benefits show care for employees—many struggle with costs and complexity. Health insurance is the most common benefit offered.
Bradd Chignoli emphasized the need for external help: "Today’s small business owners are navigating a complex benefits landscape that’s only grown more challenging in recent years... Partners such as benefits brokers and insurers are excellent resources."
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