Small Business Up, Labor Issue, Profits-August 2026

Small business is the backbone of our society, and we need to foster and support it. Small businesses not only help revitalize our downtowns, but they also create opportunities for a broad segment of society. They give people a place to start their ideas, build wealth, and contribute to an economy that continually renews itself.

So, there is some encouraging news in Bank of America’s report on small businesses. For the most part, hiring is up, although businesses continue to face challenges finding qualified labor. Profitability is also improving, with transportation and manufacturing experiencing some of the largest gains. That is positive news from a small-business perspective.

Travel spending also increased, particularly in areas such as airlines and related transportation. Overall, these are some encouraging indicators. As always, it is important to keep monitoring the statistics and watching what is happening in the broader market.

Small Business Shows Signs of a Summer Rebound

• Small business hiring strengthened during the summer, with Bank of America’s alternative hiring indicator rising 21% year over year in July and NFIB hiring plans reaching their highest level since 2022.
• Labor availability remains a challenge, with 36% of small-business owners reporting that they could not fill available positions in July—the highest level in more than a year.
• Small-business profitability improved, reaching its highest level in more than a year, suggesting that financial conditions may be stabilizing after a difficult start to 2026.
• Transportation and manufacturing businesses experienced some of the strongest profitability gains, while apparel and restaurants saw declines, demonstrating that economic conditions vary significantly by industry.
• Small-business spending increased, particularly on travel. However, travel spending rose nearly 17% while travel transactions increased only 4.5%, suggesting that higher prices—especially for airlines and gasoline—accounted for much of the increase.

Bank of America Institute. (2026, August 18). Small business checkpoint: A summer rebound. Bank of America. https://institute.bankofamerica.com/economic-insights/small-business-checkpoint-august-2026.html