2026 update: Factors affecting businesses this year

With the business landscape undergoing some transitions, now is a good time for small business leaders to take stock of what’s been impacting them lately and chart a course forward. From inflation nudging up costs to tighter access to capital, some companies may be rethinking how best to do business. A changing labor market is also keeping leaders on their toes as employees reassess what they want from work. At the same time, technology innovation offers businesses an opportunity to level the playing field and get ahead in a highly competitive environment. Following are five opportunities for small and midsize businesses (SMBs) now.

• How factors like inflation and talent are affecting businesses this year
• What shifting employee expectations mean for hiring and retention
• Ways new tools like artificial intelligence (AI) and automation can improve the way work gets done
• Practical guidance for adapting your business to a changing market

There’s no doubt the economic ups and downs have been on business leaders’ minds this year.

Small business owners have reported greater uncertainty about business conditions and whether to make capital expenditures. While companies can’t control global economic forces, they can, with the right tools and strategies, make smarter decisions as market conditions shift. Here are five key areas where small businesses have been impacted this year and what they can do going forward.

SMB’s biggest concerns:

• 53% inflation
• 30% revenue
• 19% affording employee benefits

Consumer prices began rising at a faster rate earlier this year, due in part to higher gas costs. For some businesses, this may cause higher transportation and supply costs. It’s no surprise, then, that small businesses are concerned about inflation. There’s an opportunity, however, to improve some operations in areas that you may have been putting off. Look at pricing and sales strategies: Do you have opportunities to institute recurring revenue or subscription-based models? Review supplier relationships to find opportunities to best serve your customers and manage costs. Explore where your business is experiencing slowdowns or bottlenecks and how you can streamline operations for greater efficiency.

There has been a 22% increase in freelance job postings in 2026.

Great talent is the engine of any growth-minded business. Fortunately, companies feel optimistic about their ability to retain staff. Workplace flexibility could be a key for SMB retention, with only a quarter of job seekers considering jobs that require five days a week in the office. In fact, many are deciding to stay put in their roles to keep their current level of flexibility. In broad terms, understanding and responding to employee expectations can help maintain stability, reduce turnover and, for those looking to hire, widen the talent pool.

While many businesses say they’re being conservative in their hiring plans for now, more freelance talent is available. Fractional management roles and contractors may allow you to deepen your talent bench flexibly.

82% of SMB owners say they’ll still be in business two years from now, despite volatility.

SMBs are nimble, but planning can give you a road map to help your business grow. To best position your company for the capital you may need, cash flow management and financial planning are important. Over the next quarter, set up meetings with your lenders and do a deep dive into your business with any advisers you may have. Create a clear financial plan and a solid cash flow strategy to help you understand the financing your business will need.

64% of SMBs use digital ads.

75% say digital ads help them compete with larger companies.

Technology is increasingly giving SMBs affordable ways to personalize their marketing efforts and reach highly targeted audiences. From social media platforms to email automation and e-commerce platforms, SMBs can connect directly with their customers and analyze results in real time. A local bakery may use video on social media boosted by advertising dollars to direct seasonal promotions at nearby customers. Customer relationship management and email marketing tools help SMBs track customer behavior and communicate with them consistently at relatively low cost. When you choose tools that can be integrated, the result is a digital ecosystem that lets you see what’s working and replicate it.

24% of small employers are using AI.

98% of employers using AI say it hasn’t changed their staffing numbers.

Technology innovation means that new tools are emerging in virtually every sector, leveling the playing field and unlocking the power of data for more businesses. As you move into the next quarter, consider adopting new tools and innovations to help empower your team. Currently, research shows that most SMB owners have yet to adopt AI. Only some are using new technology for tasks such as communications, marketing and predictive analytics, which leaves ample opportunity to potentially improve workflows and become better positioned to navigate economic headwinds. Here are four simple ways you can bring new tech into your business:

• Experiment with tools that fit your workflow. Start small by providing marketing staff with tools that help them create emails or develop content more easily.

• Focus on reducing repetitive tasks. People enjoy work most when they’re working on high-value tasks. Use AI to automate repetitive work, such as entering sales data into forms or processing vendor invoices.

• Use data-driven insights. One of the best uses for AI is to analyze data and spot trends. You can use it to learn more about what products are selling the best, see whether you’re low on inventory, view aggregate customer feedback and much more.

• Help customers more efficiently. Chatbots are becoming commonplace among businesses of all sizes to field simple inquiries, leaving your staff to focus on more complex issues.

While businesses have grappled with several economic forces in the first half of the year, there’s never been a better time to review business objectives and take advantage of new opportunities and technological tools. Shifts in the marketplace and innovative new tools make it easier to get work done and improve efficiencies. By staying on top of trends, retaining and attracting top talent and embracing technology thoughtfully, small businesses can thrive in any market condition.