Voice of Main Street: Small business optimism declines amid concerns about tariffs, healthcare; Latino-owned businesses report biggest losses

As Congress and the Trump administration evaluate policy changes in 2025 and beyond, it’s important that they take into account the views and needs of entrepreneurs. It’s particularly critical that they recognize that small business owners are very concerned about tariffs which are already driving up their costs. These rising expenses negatively impact their bottom line, and many small business owners have or are considering taking steps to mitigate this impact, including raising prices and pausing expansion plans.

These findings are the latest in Small Business Majority’s Voice of Main Street opinion poll series, a quarterly look at the challenges and opportunities that entrepreneurs in our network are facing when it comes to a range of issues. In addition to shedding light on tariff challenges, this latest report shows how immigration policies might continue to impact small business: Latino-owned firms are seeing less growth than businesses owned by other groups, building on our last Voice of Main Street survey that found many entrepreneurs worry mass deportation policies could harm their business and the economy. The survey also finds that small business owners broadly oppose Medicaid cuts and changes to the Affordable Care Act (ACA) in Congress’ reconciliation bill that will reduce access to health coverage for millions of small business owners and their employees. Entrepreneurs also do not approve of raising the federal deficit to pay for tax cuts for the wealthy and large corporations.

Instead of taking actions that raise costs and threaten healthcare access for small businesses, lawmakers must prioritize leveling the playing field for small firms. Entrepreneurs want legislation and a softening of executive edicts that would shield them from tariffs and create greater certainty about the future. With small business optimism in decline, federal policymakers must act soon and craft legislation that restores confidence by offering significant benefits to America’s Main Street innovators and job creators.

Key findings:

• Small business optimism declines as expenses rise: Only 36% of small business owners are optimistic about their business prospects over the next six months while 67% say that their business expenses increased over past three months.
• The vast majority (81%) of small business owners are concerned about the impact of tariffs on their business in the future; more than half (54%) are very concerned about the impact of tariffs on their business in the future.
• Many small businesses are already impacted by tariffs: 60% report that they’ve experienced higher costs for imported materials or goods due to recent tariff increases. Of these businesses, more than half (57%) say their costs have increased by 10% to 25% and nearly one quarter (24%) say their costs have increased by 26% to 50%. Additionally, 5% report increases of more than 50% and more than 1 in 10 (11%) report increases of less than 10%.

• Recent legislative proposals to exempt small businesses from certain tariffs have been introduced in Congress. The overwhelming majority (75%) of small business owners would support an exemption from tariffs for small businesses. Nearly two-thirds (62%) would strongly support it while only 5% would oppose this type of exemption. 
• More than three-quarters (76%) of entrepreneurs oppose Congress’ cuts to Medicaid. Sixty-nine percent strongly oppose the cuts and just 12% support them.
• The One Big Beautiful Bill Act sharply increases the federal deficit largely due to its tax cut provisions, most of which benefit the largest businesses and wealthiest Americans instead of Main Street. More than half (54%) of small businesses believe that deficit spending is sometimes acceptable, but not to fund tax cuts for the wealthy and large corporations. About 2 in 10 (21%) believe that not increasing the deficit should be Congress’ top priority even if it means limiting tax cuts, while only 7% believe that Congress should pass tax cuts even if it increases the deficit.
• The legislation also makes significant changes to the ACA such as shortening enrollment periods and imposing additional administrative requirements, which would cause an estimated 2 million people to lose health coverage. The overwhelming majority (76%) of small business owners oppose these changes, with 72% strongly opposed.