Small business owners across the country are the most optimistic they have been since the beginning of 2020. In a post-pandemic landscape, inflation remains a challenge for business owners, but they are optimistic about artificial intelligence.
That's according to the Small Business Index released Wednesday by Long Island-based MetLife and the U.S. Chamber of Commerce, which is based on an online survey of small business owners and decision makers conducted April 19 to May 6.
The index score, which measures small business owners' perceptions of their business operations, environment and expectations, increased to 69.5 from 62.3 in the previous quarter.
The survey found that 73% of respondents said they expect revenue to increase next year, the highest level since the survey began in 2017. Nearly half of respondents also said they expect investment to increase next year, up 10 percentage points from the previous quarter.
“Main Street employers are demonstrating confidence and resilience even amid continuing inflation,” Tom Sullivan, vice president for small business policy at the U.S. Chamber of Commerce, said in a news release about the survey results.
“Last quarter's survey showed confidence trending upward as small businesses remain optimistic about their revenues over the next 12 months,” he added. “Comfort among Main Street employers about their cash flow remains high, which is a key reason small business owners are optimistic about their ability to meet customer demand and resolve the challenges facing their communities.”
Inflation has been owners' top concern for the eighth consecutive quarter, according to the survey.
“Small business owners' continued adaptability and growing optimism are an inspiring and positive sign for the economy,” Cynthia Smith, senior vice president of regional operations at MetLife, said in a news release. “As these employers continue to invest in and hire in their businesses, they should take a holistic approach and explore solutions, such as voluntary benefits, that help build company culture and attract and retain top talent.”
Meanwhile, small and medium-sized businesses expressed optimism about the future of AI.
The majority believe that hiring employees with AI skills will save them time and money in the long run. Many also see AI as a skill that will reshape the workforce. Two-thirds of SMBs expect AI to change employee roles in the future or to see AI skills listed in future job ads. Three-quarters of SMBs said having employees who use AI tools could give them an advantage over competitors.
AI can boost productivity for companies with limited resources, and according to the EY-Parthenon report, the technology can play a role in enhancing supply chains with tools that improve things like demand forecasting and logistics.
A report from the Center for Economic Research predicts a surge in AI use by 2023, but also found that the technology's application will be “highly uneven” across sectors and states.