U.S. Small Business Sector Outlook - FY2024

As the U.S. entered 2024, the small business sector faced a mix of optimism and caution. In a survey by Slack Technologies of 2,000 small business owners (half in tech or retail), 40 % viewed 2024 as a “make or break” year for their businesses and 32 % were unsure whether they would survive the year. Nonetheless, 71 % still expressed optimism about their business outlook. AP News Meanwhile, the U.S. Treasury noted that small business optimism had rebounded in 2024, with the NFIB’s small business survey pointing to improved expectations for hiring, investment and economic conditions after inflation pressures eased. U.S. Department of the Treasury

Key drivers shaping that outlook included labour market tightness, supply-chain pressures and rising borrowing costs. Small businesses were seeking growth but operating in an environment with elevated interest rates and still high wages, which squeezed margins. At the same time, digital transformation and online customer-acquisition strategies were increasingly seen as essential: Rsearch from OnPay, reported 41 % of employers were comfortable engaging freelancers (1099 contractors) to remain flexible. For many small businesses, the path to success in 2024 would rely less on expansion and more on adaptive business models—shifting to digital channels, controlling costs and being nimble.

Going into the year, access to capital and cost management were critical. With inflation still elevated and rates high, small business owners prioritized liquidity and cash-flow resilience. According to the Slack survey, 45 % of respondents were saving funds for emergencies and 43 % were adopting technology to increase efficiency. For investors and policy makers, supporting the ecosystem of small business meant ensuring financing, enabling growth-oriented digital adoption and mitigating risk from interest-rate pressures. In short, 2024 was positioned as a year of consolidation and transformation for US small businesses.