NEXT Insurance Survey: Inflation, labor shortages top concerns for small business owners

News > Business News

Audio By Carbonatix

9:00 AM on Tuesday, April 29

The Associated Press

PALO ALTO, Calif.--(BUSINESS WIRE)--Apr 29, 2025--

NEXT Insurance, a leading digital insurtech company transforming small business insurance, today released findings from its latest survey of 500 U.S. small business owners. The data highlights persistent economic challenges, with inflation and labor shortages emerging as primary stressors for entrepreneurs in 2025 – and what SMB insurance agents need to know to keep up.

Key Findings:

Inflation Remains a Major Concern: 62% of small business owners identified inflation as their top stressor, a slight decrease from 68% in 2023, yet still the leading concern.
Reduced Consumer Spending: 43% of respondents expressed anxiety over decreased consumer spending, reflecting ongoing demand uncertainty.
Labor Shortages Intensify: Concerns about labor shortages have more than doubled, rising from 14% in 2023 to 30% in 2025, as businesses struggle to attract and retain talent.
Challenges for New Entrepreneurs: Rising costs of goods and services (47%), changes in tax policies (37%), and workforce shortages (34%) are perceived as significant barriers to starting new businesses.

These external pressures are heightening the insurance confidence gap for owners during a time when tailored insurance coverage could help alleviate concerns. The survey found that while 92% of SMB owners reported having insurance coverage:

Only 13% of those covered feel fully prepared for risk
Just 14% have insurance customized for their specific business needs
69% struggle to understand coverage, limits and policies

“Small business owners are demonstrating remarkable resilience amid economic headwinds,” said Chris Rhodes, President & Chief Insurance Officer at NEXT Insurance. “This data underscores the importance of providing accessible, tailored insurance solutions to help these businesses navigate their specific needs and protect their operations during times of market volatility and overall uncertainty.”

For more information and to access the full findings, click here and here.

About NEXT Insurance

NEXT Insurance, recently acquired by Munich Re and ERGO Group, is a leading digital insurer transforming small business insurance with simple, digital coverage tailored to the self-employed. Trusted by over 600,000 business owners, NEXT offers policies that are easy to buy and provides 24/7 access to purchasing and servicing, including Certificates of Insurance, additional insured, and more, with no extra fees.

Revolutionizing a historically complicated insurance industry, NEXT utilizes AI and machine learning to simplify the purchasing process. Founded in 2016, the company is headquartered in Palo Alto and has received over $1 billion in venture capital funding. The company has also been recognized by CNBC Disruptor 50, Forbes Fintech 50, Inc.'s Best-Led Companies, and Forbes Best StartUp Employers.

For more information, visit NEXTInsurance.com. Stay up to date on the latest with NEXT on X, LinkedIn, Facebook and our blog.

View source version on businesswire.com:https://www.businesswire.com/news/home/20250429161447/en/

CONTACT: Media Contact:

Anat Harel

NEXT Insurance, Inc.

Director, Digital Marketing

975 California Ave

Palo Alto, CA 94304

Phone: +1 669-264-6431

[email protected]

KEYWORD: UNITED STATES NORTH AMERICA CALIFORNIA

INDUSTRY KEYWORD: PROFESSIONAL SERVICES PUBLIC POLICY/GOVERNMENT SMALL BUSINESS OTHER POLICY ISSUES INSURANCE FINANCE LABOR