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Rising Confidence Among Small-Business Owners in the U.S.

Small-business owners across the United States concluded 2025 with an uplifting sense of optimism, defying ongoing discussions about potential economic challenges. Various indexes suggest a notable improvement in sentiment as cost burdens begin to ease and uncertainty diminishes. This positive momentum sets a promising course as we enter the new year.

Optimism on the Rise

The National Federation of Independent Business (NFIB) Small Business Optimism Index experienced a healthy increase of 0.5 points, reaching 99.5 in December. This marks the highest level since August and holds above the 52-year historical average of 98, as reported by the NFIB. The second consecutive monthly gain can be attributed to owners’ expectations of better future conditions, with the net share jumping significantly by 9 points to 24%, the first notable increase since July.

Additionally, the NFIB Uncertainty Index fell sharply by 7 points to 84, its lowest mark since June 2024. “2025 concluded with a noticeable uptick in small business optimism,” noted NFIB Chief Economist Bill Dunkelberg. “While business owners express ongoing concerns regarding taxes, they are optimistic about favorable economic conditions anticipated in 2026, driven by reduced cost pressures, easing labor challenges, and anticipated increases in capital investments.”

Positive Indexes Indicate Stability

A closer look at business health ratings reveals a positive shift towards stability. Approximately 54% of small-business owners classified current conditions as good, an increase of 1 point, while 34% deemed them fair, up 4 points. Ratings for excellent conditions decreased to 9%, and a mere 3% rated conditions as poor. The most pressing concern remains taxes, which impacted 20% of owners— the highest rate since May 2021— followed closely by labor quality at 19% and inflation at 12%.

Comerica Bank’s Small Business Pulse Index reflects similar optimism. A survey involving over 1,000 owners indicated that 80% felt somewhat or very confident about their prospects for the upcoming 12 months. Moreover, 79% forecast revenue growth averaging 7.9%. Notably, technology firms exhibited the highest level of confidence at 93%, planning to invest an average of $187,000 in capital spending. In contrast, 57% of all businesses planned investments averaging $109,000.

As Comerica Bank executive vice president and national director of retail and small business banking, Larry Franco, commented, “Small businesses have persevered through a trying year marked by challenges such as tariffs and inflation; yet, their optimism remains steadfast.”

Resilience in Sales and Employment

The Fiserv Small Business Index, based on data from 2 million firms, indicates that December saw sales inch upward from November, largely due to the resilient nature of small businesses during the holiday season. “December’s sales uptick is indicative of small businesses’ resilience amid a highly competitive holiday market,” stated Fiserv chief data officer Prasanna Dhore, as reported in The Guardian. Consumers’ emphasis on essential items amid cost difficulties resulted in modest growth for many firms.

Intuit’s QuickBooks index, which encompasses over 420,000 businesses, reported a 0.04% rise in small-business employment, translating to 5,500 jobs in December. This growth was observed across eight of 12 sectors and throughout all eight geographic regions. Revenue per business also experienced a 1.27% increase, reaching a real average of $48,270, with advancements noted in 10 sectors and all regions, as highlighted in the Intuit report.

Ongoing Labor Dynamics and Challenges

Labor dynamics continue to be at play in the small-business sector. According to NFIB data, 33% of owners reported having unfilled job openings, a figure that remains steady but is above the historical average of 24%. Additionally, 17% of owners expressed intentions to hire, although this represents a slight decrease. Compensation raises for employees affected a net of 31% of businesses, showing an increase of 5 points.

Policy Uncertainty and Its Impact

Although capital outlays have strengthened, with 56% of respondents reporting recent spending increases (up 4 points), plans for future investments have slightly eased to 19%. Improvements were also noted in inventory reports, reaching the year’s best at net -1% gains. However, significant challenges remain. Comerica’s findings indicated that inflation is still the leading concern for 23% of owners, with tariffs impacting 14%. Interestingly, 42% experienced negative effects from tariffs, particularly in the manufacturing and retail sectors. “Many expect tariff complications to persist or worsen in 2026,” according to the survey.

Holly Wade of the NFIB acknowledged the lingering uncertainty surrounding tariffs but also noted that inflation appears to be easing. She described the 99.5 index reading as a conducive position for moderate economic growth, as quoted in The National Desk.

Sector and Regional Performance Variability

Distinct sector performance trends have surfaced: Intuit’s data revealed that professional services added 3,600 jobs, while the agriculture sector exhibited the fastest growth at 0.64%. In terms of confidence levels, Comerica found healthcare businesses reporting a robustness in confidence at 90%, whereas real estate entities showed the lowest at just 67%. Regionally, Intuit noted that employment was growing most rapidly in the Rocky Mountains, while revenue saw the largest gains in the Plains. Comerica revealed that confidence was highest in the South at 83%.

Net nominal sales reported by NFIB owners reflected a decrease at -8%, which is below average. Still, expectations for real sales remain stable. While plans for price hikes have eased, they are still elevated in historical context due to profit fluctuations.

Recent Federal Reserve interest rate cuts have positively influenced over half of the Comerica survey participants’ sentiments. Gene Marks emphasized in The Guardian that while sectors like agriculture, retail, transportation, and services continue to face hurdles such as tariffs and regulatory issues, the collective resilience of the nation’s 33 million small firms is commendable.

Investment and Hiring Trends Looking Forward

Despite softer spending plans, NFIB data still indicates a rise in capital investing, a sign of confidence in long-term stability. “The decrease in the uncertainty index suggests that more small businesses have a clear understanding of their operating environment, which is conducive for investments,” was a key observation reported by The National Desk.

Companies such as Infrastructure Capital Advisors have echoed this trend, emphasizing NFIB’s rise to 99.5 above average, while NRCC linked this optimism to pro-growth policies. Furthermore, Apex Macro Research noted that optimism may be connected to market dynamics but expressed caution over softening labor and capital expenditure plans.

While 64% of businesses report unaltered supply chain challenges, and tax-related worries persist, small-business owners are preparing to face various policy tests in the coming year. Nevertheless, encouraging insights from NFIB, Comerica, Fiserv, and Intuit paint a brighter picture. They emphasize adaptation, modest expansion, and a forward-looking attitude among America’s indispensable small-business sector.

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