washington dc — Quarterly MetLife and U.S. Chamber of Commerce small business index, announced today, found that concerns over inflation among small business owners have reached new heights. A majority of SMEs (90%) say they are concerned about the impact inflation will have on their business, with 54% saying they are concerned. very This is up from just 31% in Q1.
Half of SMEs (50%) say inflation is the biggest challenge facing SMEs today, marking the fifth consecutive quarter of growing concern about inflation. Seven in 10 (71%) believe the worst is yet to come when it comes to inflation.
said Tom Sullivan, vice president of small business policy at the US Chamber of Commerce. “However, inflation has hit small businesses hard, a reality that is hurting their confidence, their ability to recruit, their ability to invest in their businesses, and their ability to grow.”
Growing economic pessimism may have contributed to the biggest decline in the index score since the pandemic began, from 66.8 in the second quarter to 62.1. Additionally, small businesses say they have lost confidence in both their domestic and regional economies and their current cash flows.
The survey found that 88% of small businesses are concerned that the US will enter a recession next year, and 54% are concerned. very Concerned. A majority of small business owners (59%) believe the US economy is in “somewhat bad” or “very bad,” up 10 percentage points from the previous quarter.
Two in three (66%) say they are satisfied with their current cash flow, down from 73% last quarter and the biggest decline since April 2020. increase. (38%) and those predicting increased revenue in the coming year (61%).
Small business owner Tom Richter is seeing the effects of inflation at his Midvale, Utah-based commercial cleaning service company.
“The increase in gas has forced us to raise prices to our customers across the board. The increase in raw materials has impacted the chemicals and equipment used in our operations,” said JAN of Utah. -Pro principal owner Richter says. “Our franchise owners had to raise wages for their day-to-day employees.”
Most of the small business owners (83% of respondents) who said that rising prices are having a significant impact on their business said the cost of goods and supplies (65%) and utility bills or fuel (50%). as the most affected locations. impact.
Cynthia Smith, senior vice president of MetLife’s Regional Business, said: “We have seen how resilient small businesses can be even in the face of adverse business conditions. spirit will be required.”
Other findings:
- when asked to choose Either contain inflation or avoid a recession, 59% believe the current priority is to contain inflation and 41% believe avoiding a recession should be a priority.
- 7 out of 10 SMEs to Cope with Inflation Those who said they had raised prices in response to inflationary pressure said they took out loans (40%), cut staff (37%) and reduced the quality of products and services (31%).
- 42% say the local economy is unhealthy, For the first time since Q1 2021, more than 31% said they were healthy.
- Three-quarters (76%) of SMEs Respondents say they have plans to adapt to the changing economy. A majority (61%) believe the economy is changing faster these days than in the past.
- 40% say yes very Concerned Impact of rising interest rates(up 11 percentage points from Q1 2022).
- A majority (51%) say they have changed their supply chain. In a sign that small businesses may be shortening their supply chains, reliance on local suppliers has increased over the last year.
- Concern over COVID-19 fades, It fell to 13% from last year’s 23% as the economic issue grew in importance.
About the SME Index
MetLife and the U.S. Chamber of Commerce small business index It is part of a multi-year collaboration between MetLife and the U.S. Chamber of Commerce to raise the voice of U.S. small business owners and highlight their important role in the U.S. economy. An online survey of 752 small business owners and decision makers, the quarterly index examines the temperature of the sector and finds out where small business owners are confident and where they face challenges. It is designed to check whether
The Q3 2022 survey was conducted between 21 July and 8 August 2022. The confidence interval for this survey is plus or minus 4.4 percentage points for all respondents.
About the American Chamber of Commerce
The American Chamber of Commerce is the world’s largest business organization representing businesses of all sizes in all sectors of the economy. Our members range from small businesses and local chambers of commerce lining America’s main streets to major trade associations and large corporations.
They all have one thing in common. That means the American Chamber of Commerce is counting on you to speak up in Washington, across the country, and around the world. For more than 100 years, we have advocated pro-business policies that help businesses create jobs and grow the economy.
About MetLife
MetLife, Inc. (NYSE: MET), through its subsidiaries and affiliates (“MetLife”), is one of the world’s leading financial services companies, providing insurance, annuities, employee benefits and wealth management. We help individual and institutional clients achieve their goals. A changing world. Founded in 1868, MetLife operates in more than 40 markets worldwide, with leading positions in the United States, Japan, Latin America, Asia, Europe and the Middle East. For more information, see: www.metlife.com.