The MetLife & U.S. Chamber of Commerce Small Business Index is 68.4 this quarter, down from last quarter (72.0) and similar to Q4 2024 (69.1).Most measures this quarter do not show a significant decline, however, there is a slight softening across some key measures, including comfort with cash flow and future hiring/investment expectations.

Notably, fewer small businesses report being very comfortable with their current cash flow this quarter. Additionally, views of their local economy have declined slightly, with two in five (43%) small businesses saying that their local economy is in good health. At the same time, views of the national economy are stable: 38% say the same of the U.S. economy, similar to last quarter. Longer term, outlooks for both the national and local economies are more optimistic compared to this time last year.
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This quarter, inflation continues to be the biggest challenge facing small business owners, but these inflation concerns have remained stable for the past two quarters. However, more small businesses are reporting increased challenges for both revenue and employee retention. Slightly more small businesses cite employee retention (17%) as a challenge this quarter (was 12% in Q4 2024). In the same vein, compared to this time last year, concerns about attracting talent have more than doubled. This quarter, 14% said attracting talent was a top challenge (up from 6% in Q4 2024).

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