Despite weak jobs market and rising inflation, small-business confidence hits new high
Add Axios as your preferred source to
see more of our stories on Google.
An index that measures the confidence of small-business owners surged to its highest level since 2017.
Why it matters: The index, published by the U.S. Chamber of Commerce on Wednesday, is somewhat surprising given that other indicators are showing the labor market is deteriorating and inflation is worsening.
By the numbers: Researchers surveyed 750 small-business owners and operators who run companies with 500 or fewer people.
- The index rose to 72 in the third quarter, up from 65.2 in the previous quarter, and just slightly higher than this time last year. (A higher score indicates more positive sentiment.)
- 40% of business owners said the U.S. economy is in good health, up from last quarter (34%) and this time last year (35%).
Zoom in: Small-business owners are liking the "big, beautiful bill" passed in July, says Tom Sullivan, vice president of small-business policy at the Chamber.
- They're particularly into a 100% bonus depreciation that lets owners write off all the costs of certain investments in the year they purchase them.
- Passage of the law removed some uncertainty that had been weighing down this group's outlook.
Reality check: Rising costs are still a drag on optimism. Inflation was a top concern for the 15th consecutive quarter, with 46% saying that inflation is the top challenge. Still, that's down from a year ago, when it was at 52%.
The big picture: Both in the U.S. and globally, the economic picture has held up, despite ominous forecasts from the spring after President Trump announced steep tariffs.
- Indeed, the Organisation for Economic Co-operation and Development said on Tuesday that the global economy is performing better than forecast.
What to watch: The worst might still be ahead as Trump's tariffs take effect, writes Axios' Neil Irwin.
