Small Business Checkpoint: Holiday Gains and Hiring Trends

This report details the state of small businesses as of December 2025, with a focus on recent profitability trends and employment dynamics. It highlights that small business profits remained positive in November, largely due to events like Small Business Saturday, although year-over-year profitability growth turned negative for the first time in 18 months. A significant rise in the percentage of business owners raising prices suggests that many are passing on increased costs related to tariffs and inflation. The report also indicates a decline in payments to hiring firms, confirming a weaker job market within small businesses. Despite this, optimism for the upcoming year appears to be increasing, driven in part by anticipated advancements in AI technology. The report emphasizes the challenges faced by small businesses, especially in sectors affected by price hikes and labor shortages, while noting that payroll growth has been positive in specific sectors such as construction and restaurants. Overall, it provides a snapshot of the economic pressures and opportunities facing small businesses.