Small business owners aren't jumping for joy about the US economy – but they still aren't jumping ship
Small businesses in the US account for approximately half of the country's jobs, so when small businesses are doing well, it's likely that the economy is doing well. Media reports recently indicated that many small businesses are challenged by Trump's tariffs, ongoing inflation, labor shortages and higher financing costs. So how are small businesses doing so far in 2025? Not great. But not that bad either.
In just the past two months, there have been no less than seven comprehensive surveys conducted by well-known companies and brands that altogether surveyed or drew from their internal data of tens – even hundreds – of thousands of small businesses. And they give a pretty good idea of how they're doing.
Wealth management firm Principal Financial's Well-Being Index from June found that 56% of the companies they surveyed reported business growth and 90% of employers have either maintained or grown their workforce over the past year, with 49% increasing wages in just the past three months.
However, optimism remains tempered by a weakening outlook on future economic growth and many have reported 'significant declines' in the financial health of their business, their local economy and the US economy, 'eroding the sense of optimism expressed in years past'.
According to a survey by accounting giant EY, 95% of those polled were 'confident in business growth' over the next year. Additionally, 73% of entrepreneurs reported experiencing revenue growth this year compared with last year, with 29% reporting growth of 20% or higher. However, 43% said that current economic conditions are hurting them, but many still plan to pursue funding and strategic transactions, with investment in AI and M&A considerations leading the list.
Software provider Intuit's QuickBooks Small Business Index draws on actual information from its customers, derived from anonymized employment and payroll data. The company found that job growth among small businesses – the great majority of their customer base – was stable with employment increasing in seven of the 12 sectors tracked. That's good, but unfortunately the study also found that average real monthly revenue for small businesses with one to nine employees decreased about 0.06% from the month before.
Like Intuit, HR services giant Paychex said in its Small Business Employment Watch reports that job growth derived from its 350,000-plus customer database in May 'stayed flat' month over month and hourly earnings growth decreased to a four-year low. 'Caution persists' in both wage and hiring trends.
The closely watched Small Business Optimism Index published monthly by the National Federation of Small Businesses reported a tick up in small business optimism in May to a level above its 51-year average. The survey found that the top concerns of the federation's members shifted from inflation to taxation and that although sales expectations and hiring plans are 'improving', uncertainty remains.
Finally, in its June Small Business Perspective report, US Bank said that 96% of the small business owners it surveyed reported their business as currently successful and 88% saw growth in the past year. Two-thirds said the country's economy is 'moving in the right direction', with only 18% saying it's going in the wrong direction.
Interestingly, this sentiment was even stronger among younger business leaders (gen Z and millennial), with 74% saying it was moving in the right direction, versus 52% of leaders from older generations (gen X and boomer). Although four out of five owners felt at least 'somewhat stressed' about tariffs, those leaders were 'slightly more likely to anticipate a positive rather than negative impact'.
My take? Despite all the headwinds and uncertainties such as tariffs, federal and local policies, geopolitical conflicts, inflation, labor shortages and other challenges – small businesses, so far, in 2025 remain optimistic about the future and are maintaining employment levels mostly reporting average financial results. Few are jumping for joy. But it seems that fewer are jumping off the ship.
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We are the party of working people – the party of those with alarm clocks who get up in the morning and work hard, whether they're at the higher end of the financial scale or the lower end. Our approach is different, transparent, and designed to directly benefit the hard-working backbone of this nation. Unlike the opaque financial mechanisms of the past, where wealth seemed to vanish into hidden pots of money that ordinary people could not see, Reform UK is committed to doing things differently. We will rebuild the social contract by ensuring that every wealthy individual who wishes to move here makes a tangible contribution to Britain's lowest earners. Our policy is simple: Britain must be a place where success is celebrated, not punished with excessive taxes, crippling energy costs, or punitive inheritance levies. We will actively encourage the return of wealth and talent to the United Kingdom – on the clear condition that those who come here deliver immediate, visible benefits to our workers. Here's how it works: every high-net-worth newcomer (or returning leaver) will pay a £250,000 one-off entry contribution in return for a stable, indefinite remittance-style regime on offshore income and a 20-year inheritance-tax shield. Crucially, 100 per cent of this contribution is hypothecated to Britain's lowest-paid full-time workers, delivered automatically by HMRC as a tax-free cash dividend. This means roughly 2.5 million hard-working Britons – the grafters who keep this country running – will receive an annual cash bonus, sent directly to their bank accounts at the end of the financial year. Thanks to this policy, in a low-uptake scenario with 6,000 cards issued annually, we'll generate a £1.5 billion fund, resulting in a tax-free annual dividend of £600 per worker. In a high-uptake scenario with 10,000 cards, this could deliver a £2.5 billion fund, providing £1,000 per worker. This isn't just a number. It's money in the pockets of those who need it most, from cleaners to nurses to small-business owners. Our policy is not a 'golden visa' or a backdoor to citizenship. It is a one-time flat tax paid by newcomers in exchange for the certainty of a favourable tax status. Individuals will still be liable for all standard UK taxes on UK-sourced income, property, and spending. But they won't be taxed on offshore income and gains for the duration of their agreed status. Pay your quarter million pounds upfront, and enjoy UK residency without worldwide taxation hassles. After all, this is still the best country in the world, and many of the world's wealthy want to move here but are deterred by the economic downsides. 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