U.S. Small Business Optimism Rises, but Public Economic Discontent Persists

Dragon Media News Desk

Small business confidence in the United States rose noticeably in July, even as broader public sentiment toward the economy remained largely negative, according to recent surveys.

The National Federation of Independent Business (NFIB) said its Small Business Optimism Index increased by 2.4 points in July to 99.8. The reading was above the index’s 52-year average of 98 and marked its highest level since August 2025.

NFIB Chief Economist Bill Dunkelberg said business owners had become more optimistic about hiring and capital investment. Despite continued uncertainty, he said small businesses generally expected operating conditions to improve.

According to the survey, 20 percent of small business owners planned to create new jobs over the next three months, up nine percentage points from June. That was the strongest hiring outlook since October 2022.

The share of businesses planning capital expenditures over the next six months also increased, while the proportion planning to raise prices declined from the previous month.

The picture among the broader American public, however, remained considerably less upbeat.

A Gallup survey released in July found that only 22 percent of Americans rated current economic conditions as excellent or good. Another 32 percent described conditions as fair, while 44 percent said they were poor.

Gallup’s Economic Confidence Index improved from minus 38 in June to minus 31 in July, but overall sentiment remained negative. Around 67 percent of Americans said they believed economic conditions were getting worse.

The divergence comes more than a year into President Donald Trump’s second term, as households continue to face pressure from living costs, housing expenses, fuel prices and elevated interest rates.

Economists and political analysts note that business owners and ordinary workers may assess the economy differently. Business owners often focus on future sales, hiring, taxation and investment conditions, while households are more directly affected by wages, everyday expenses and housing costs.

Darrell West, a senior fellow at the Brookings Institution, said improved optimism among small businesses was a positive sign, but many Americans were still struggling to make ends meet.

Christopher Galdieri, a political science professor at Saint Anselm College, similarly noted that favorable economic indicators do not always translate into positive public sentiment.

He said the same pattern was visible during former President Joe Biden’s administration, when inflation had begun to ease and employment remained strong, yet dissatisfaction with the economy persisted among many voters.

With the 2026 midterm elections approaching, public perceptions of the economy could become increasingly important politically. Even if business confidence continues to improve, persistent financial pressure on households could remain a challenge for the Republican Party.

The latest data therefore highlight a notable divide in the U.S. economy: small business owners are becoming more optimistic about the future, while a large share of the public remains dissatisfied with present economic conditions.