Small-business confidence near record low for holidays
Small-business confidence is at its second-lowest level since tracking began, according to Main Street America’s Fall 2025 Small Business Survey.
The nonprofit’s Fall 2025 Small Business Survey shows that small-business owners are approaching the holidays with anxieties about sales. Their confidence ticked up just three-tenths of a point since the Spring 2025 survey, when their confidence was the lowest ever measured. Fall 2025 confidence is the second-lowest average rating over the course of seven biannual surveys.
The survey was conducted in October and collected responses from representatives in the retail, food and beverage, professional services, personal services, and arts and entertainment sectors in 48 states, Washington, D.C. and Puerto Rico.
Businesses with fewer than three full-time employees reported an average confidence rating of 6.8 out of 10 versus 7.2 among businesses with more than 10 full-time employees. Professional services reported an average confidence rating of 7.9, compared with 6.8 among owners of retail and food and beverage businesses.
Long-standing businesses launched at least 10 years ago had an average confidence rating of 7.2, compared to 6.9 for businesses launched in 2020 or later. Small-scale makers and manufacturers had higher confidence ratings than businesses that did not produce any packaged goods, with averages of 7.3 and 6.9, respectively.
Over the past three months, 38% of businesses reported a decline in revenue, and 45% saw a drop in net profit. Not all businesses had losses: 58% of respondents reported either steady or increasing revenues, and 49% reported steady or growing net profits.
The smallest businesses reported the most significant economic strain. Among those with fewer than three full-time employees, 40% experienced declining revenue, twice as many as businesses with more than 10 full-time employees.
Net profit remained a challenge for many business owners, with 52% of retail businesses reporting a decrease from August through October 2025.
Broad social and economic trends are rattling small-business operations, according to the survey. Many respondents indicated that their confidence and operational decisions were influenced by inflation, shifting consumer spending patterns, higher tariffs and the federal government shutdown.
The survey highlights the vulnerability of vital Main Street businesses, which are often overlooked and underrepresented in traditional small-business reporting, Main Street America stated.
“Small businesses with fewer than 25 employees make up 98% of all American businesses,” Erin Barnes, president and CEO of Main Street America, said in a statement. “During the holiday season, when many small businesses earn up to 40% of their annual revenue, we can all make a difference by shopping small and shopping locally,” she added.
Nearly three-quarters (72%) of respondents to the Fall 2025 survey have fewer than three full-time employees, and 82% have fewer than 10 employees (including full-time, part-time and seasonal or temporary staff). Most business owner respondents contribute to local causes (70%), hire locally (63%), use local vendors (56%) and support their local Main Street program (53%).
Consistent with past surveys, 72% of respondents were female business owners. Most business owners relied on in-person visits, and 48% did not engage in e‑commerce or online sales. Retail and food and beverage businesses represented 62% of respondents, with professional services (9%), personal services (7%), and arts and entertainment businesses (6%) completing the top five industries.
Main Street America asked business owners how they planned to capture demand during the holiday shopping season. It received four categories of responses:
- 40% of businesses pre-ordered inventory well in advance in an effort to manage expenses and were eager to move their products and generate revenue.
- 25% of respondents focused on marketing and promotions efforts to maximize holiday sales opportunities.
- 10% planned to offer new products or take new approaches to their holiday business operations.
- 25% said they did not make seasonal preparations or indicated that the holiday season did not impact their businesses.
