Navigating Uncertainty: Insights from the Q2 2025 Vistage CEO Confidence Index

Small Business Confidence Dips Amid Rising Economic Uncertainty

Update Navigating Economic Uncertainty: Small Businesses on EdgeThe latest findings from the WSJ/Vistage Small Business CEO Confidence Index reveal a slightly worrying trend: after a modest boost earlier in the summer, the confidence level dipped to 85.0 in August 2025. Despite this small decline, a significant undercurrent of economic uncertainty looms over small businesses. Many CEOs fear the unpredictable effects of recent political and legislative changes, including the ramifications of the One Big Beautiful Bill Act (OBBBA).Nearly half of the surveyed small business leaders have reported experiencing an increase in economic uncertainty over the last few months. The uneasy atmosphere can largely be attributed to sporadic headlines concerning tariffs, trade disputes, and significant legislative movements, including the OBBBA's slow rollout compounded by ambiguity surrounding its tax provisions.Impact of Tariffs: Cost Pressures MountingEven though the index recorded only a slight decline, the reality for many businesses is that uncertainty revolves around changing tariff policies. CEOs find themselves grappling with higher costs incurred from vendors adjusting prices to accommodate tariffs. Guillermo Arrieta, the President of GA Flooring, emphasized this reality, noting that his business had to pass along some of these increased costs to customers, underscoring how external variables influence pricing strategies.Bob Pilon, CEO of Dynamic Tub, Inc., highlighted an alarming trend in pushing costs onto consumers, stating that their company has implemented a notable “120% pass-through of all international tariff charges.” This stark measure illustrates how quickly financial burdens can amplify within supply chains, prompting business leaders to reassess spending plans. Many projects are now being delayed, directly linked to the inability to confidently predict future costs.The Lingering Hesitations Around the OBBBADespite the business-friendly intentions cozying up to the OBBBA, enthusiasm among small business owners remains scarce. A little over one-third of the respondents view the bill positively, while 28% report neutrality and a concerning 24% maintain a negative outlook. These mixed feelings reveal an inherent skepticism toward the promised benefits, despite claims of potential tax stability and growth incentives.An overwhelming 53% of business leaders feel it’s premature to initiate shifts in their operational strategies due to the OBBBA. Among those who are inclined to make changes, workforce investment stands out: 24% intend to hire more employees while 23% are planning wage increases. However, only 3% are looking to provide additional benefits at this time, indicating a conservative approach in light of precarious circumstances.How Small Business Leaders Are RespondingThe mixed reactions to proposed legislative changes highlight a more cautious stance among CEOs. While some continue to cling to hope for eventual economic improvement, many are adamant that the resilience of their businesses depends on navigating through these uncertain waters effectively. Dale Lemmons, President of Interstate Wood Products, shared a sentiment echoed by several peers: tax certainty is crucial and indeed valuable for facilitating sustained growth.On the other hand, the prevalent concern about deficit spending impacts the overall sentiment. Leaders like Tom Ratliff from Canopy Corporation express a growing worry that protracted deficit spending could risk long-term economic health. This cautious but firm perspective further encapsulates how industry leaders navigate the intricacies of financial planning amid shifts in legislation.The Path Forward for Small BusinessesAs uncertainty prevails, the future of small business confidence may hinge on stabilizing economic indicators and clearer legislative communication. The decision-making hesitancy witnessed now poses a ripple effect, delaying growth opportunities and business expansion.It is crucial that business leaders stay engaged and well-informed about policy changes and trade dynamics. Attending advisory group meetings, engaging in discussions with peers, and exploring membership options can possibly help them gather insights that may shape their strategy moving forward.Ultimately, while some small business leaders view the landscape with a sense of unease, it also presents an opportunity for growth through adaptation and innovation. Making informed decisions in these uncertain times will be pivotal to navigating the challenges ahead and ensuring robust business endurance.In conclusion, business leaders must remain proactive and adaptable in response to the fluctuating economic landscape. Understanding these dynamics can enable them to formulate strategies that not only survive but thrive amid challenge. Finding the right support through industry networks, such as Vistage, could provide vital resources and insights for navigating these complex times.