U.S. Small Businesses Pull Back on Hiring at Fastest Pace in Six Years

A cluster of fresh data released this week paints a cautious picture for small businesses in the United States: hiring ambitions are fading, foot traffic is declining, and owners are growing more hesitant about the months ahead.
The share of U.S. small businesses planning new hires or reporting trouble filling open positions fell in May to a six-year low, according to the National Federation of Independent Business. The NFIB Small Business Employment Index remained essentially flat at 100.3, and 29% of owners reported job openings they could not fill — down 5 points from April and the lowest reading since May 2020.
On the sales side, the picture is mixed. U.S. small business sales edged up 0.7% year over year in May, but the gain was driven entirely by higher average ticket sizes — up 3.1% — while the number of transactions fell 2.4%, marking the seventh consecutive month of declining foot traffic.
There is, however, one bright spot. The Paychex Small Business Jobs Index improved for the third consecutive month in May — a streak not seen since February 2023 — reaching its highest level of 2026 so far, with hourly earnings growth holding steady at 2.73%.
Taken together, the data suggests small businesses are managing to keep revenues afloat by charging more, while quietly scaling back on growth plans and new headcount. A resilient surface, with growing caution underneath.
Read more: Bloomberghttps://www.nfib.com/news/press-release/nfib-jobs-report-small-business-job-openings-decline/