America’s small businesses are pressing forward through a stretch of rising costs, tariff uncertainty and stubborn inflation, even as confidence in the months ahead cools, according to a fresh survey of employers.

The National Small Business Association’s 2026 economic survey paints a community confronting increased costs and economic insecurity, with many owners hesitant to take on significant growth. Current revenue and employment have held steady, but expectations for future expansion have slipped, a pattern echoed in federal data on employer firms.

Separate industry readings describe a “K-shaped” divide: firms with pricing power are managing, while those most exposed to input costs and trade friction are cutting expenses and passing higher prices to customers. Tariff tensions and recession fears weigh on planning, and lenders describe fragile stability alongside persistent inflationary pressure.

Nearly half of employer firms in a federal report said forward-looking revenue and hiring expectations weakened, even as present conditions stayed stable. The caution is practical rather than panic: owners are trimming discretionary spending and delaying hires rather than enacting broad cuts.

Small employers account for a large share of U.S. jobs, so their restraint is a leading signal for the broader economy. Economists watch the sector for early signs of whether softening expectations harden into actual cutbacks, a shift that would matter far beyond Main Street.

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