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Amid rising fuel prices and inflation across the US, confidence among small-business owners has declined in recent weeks as many continue to grapple with higher costs and economic uncertainty.

According to the National Federation of Independent Business, its Small Business Optimism Index fell by 0.6 points to 95.3 in May. At the same time, 29% of small-business owners reported having open positions they could not fill – the lowest level since the Covid-19 pandemic.

In May, 13% of owners said labor quality was their biggest issue, while 14% identified labor costs as their primary challenge.

Beyond workforce pressures, several small-business owners said that inflation and rising fuel costs are further squeezing already thin margins.

For Barrett Willits, the 58-year-old owner of Barry’s Blind Factory in Huntsville, Alabama, the challenges are coming from multiple directions. His business, which has operated for 33 years and sells directly to consumers, has been hit by declining sales and rising supply-chain costs.

“Sales are down, market share is down. Our suppliers have been bought out by a hedge fund that also owns Heinz. They shut down American-staffed manufacturing outlets and shifted production to Mexico. So now our shipments travel thousands of miles to us when they used to travel 100 miles. Every time you turn around, there is a new price increase, a new shipping rate, a new surcharge,” he said.

For Willits, the biggest concern is the impact rising costs are having on consumer demand.

“People can only afford so much before they just stop buying,” he said.

Higher fuel costs are also taking a toll on businesses that rely on travel. Tina Spears, a 73-year-old pet sitter in Anchorage, Alaska, says recent increases in gas prices due to the US and Israel’s war on Iran have affected her business.

“I’m a cat sitter, and I drive to visit my clients. The gas prices exploded after this senseless war and my business has really been affected by the money I have to spend in order to get to the cats I visit. I raised my rates, which helps a little, but how high can I go when everything else is so expensive?” she said.

The impact of rising costs extends beyond transportation. For Roger, a 62-year-old bed-and-breakfast owner in Sevierville, Tennessee, he has to work extra hard to maintain quality while keeping prices stable for guests.

“While I continue to source local and high-quality ingredients for breakfasts, I have worked harder to minimize waste and to manage costs. I chose not to increase rates this year, and through implementation of yield management pricing, my average nightly rate has decreased slightly, but the increased occupancy has more than compensated,” he said.

Still, he says, further cost increases may leave him with little choice but to raise prices.

“If costs continue to increase, then I will have no choice but to raise rates. In addition, if the cost of transportation continues to increase due to unrest in the Middle East, then my customer base will find it harder to justify traveling on vacation, or may opt for shorter holidays closer to home.”

In northern California, Geoffrey, a 58-year-old plumber who employs two workers, says changing consumer behaviors have forced his business to adapt.

“We used to do remodels. That was our more profitable work. Now 80% of our work is just plumbing emergencies,” he said, adding: “My employees are complaining of not enough hours. We’re all adjusting to eating lighter and making our money stretch … I don’t know whether I will ever retire.”

Other owners are looking for new ways to maintain profitability. Katrina Oprisko, 56, who owns Earthwell Refills, a natural refill store in San Diego, California, says she has become more selective about inventory and product offerings.

“We are introducing new products to our store that hopefully will increase our profit,” Oprisko said. “I’ve added a bit of delay in ordering. We’re being a bit more strategic about what comes in the door and when.”

Despite steady foot traffic, she says, customers are spending less.

“We still are getting the same amount of people entering our doors, but they aren’t buying as much. Coupled with the increase in the price of goods, it’s a sticky situation,” she continued.

Meanwhile, for Braxtin Angelo in Washington state, who describes herself as a 43-year-old mother with disabilities who sells topical products to people with disabilities and chronic pain, the Trump administration has pushed her business to the brink. She said she fears that “something I poured my entire heart into, to help bring some comfort and support to my community and those beyond, will be completely gone”.

“After the election, not only did hope plummet with the knowledge that my communities’ care and visibility would start to struggle, but the ability to actually purchase did as well,” Angelo said.

“Healthcare has become more difficult to navigate, since many are on state insurance,” she added. “Besides this, the ‘tariffs’ set in place immediately impacted my ability to acquire quality items needed for my business. Post office prices have escalated so much that it’s almost impossible for me to ship out any items without netting a loss on my website.”

For other owners nearing retirement, the economic climate is creating additional uncertainty. Keith Lam, a 67-year-old resident of Albuquerque, New Mexico, who operates a hearing-aid dispensing clinic with his wife, says he has been unable to find a buyer for the business.

“We planned to sell the business and retire this year or next year, but due to the current economic condition, it is hard to find a buyer. The business is very slow, we can barely keep ourselves afloat. Fortunately, I decided to take my [social security benefits] this year, so we basically survive on that,” he said.

To cut costs, Lam and his wife have reduced their operating hours.

“We are now only open two days a week and purely by appointments to save gas and utility. We worry that we will slowly go out of business due to the lack of patients before we can sell our clinic,” Lam added.