Small Business CEOs Face Inflationary Squeeze as Confidence Slips

The latest Vistage CEO Confidence Index reveals a marked shift in sentiment, reversing three consecutive quarters of optimism. Nearly half of surveyed CEOs—45%—now view the U.S. economic climate as deteriorating, a sharp 13-point jump from the first quarter. This pessimism is largely driven by a 4.2% inflation rate recorded in May, which has intensified concerns over mounting input costs, fuel prices, and lingering tariff effects. Joe Galvin, Vistage’s chief research officer, noted that the index has reset to its three-year average, establishing a new, volatile baseline where uncertainty defines the operating environment.

Despite the gloomier outlook on the broader economy, internal business performance indicators remain resilient. Roughly 64% of leaders still anticipate revenue growth over the next year, and 50% plan to expand their workforces. However, the focus has shifted toward efficiency and selective hiring rather than aggressive scaling. As 74% of CEOs report increased price sensitivity among customers, the challenge lies in balancing necessary price hikes against stagnating margins. Furthermore, the human cost of this high-pressure environment is climbing, with 70% of executives reporting occasional or frequent burnout, underscoring the exhaustion behind the current corporate pivot.