US Unemployment Rate Expected to Rise Amid Small Business Challenges

The Kobeissi Letter posted on X. The U.S. unemployment rate is anticipated to increase as 11% of small businesses in the country reported 'poor sales' as their primary concern in February. This figure is near the highest since 2020 and ranks as the fourth most cited issue, following taxes, quality of labor, and inflation. Over the past three years, the percentage of businesses citing poor sales has tripled, aligning with levels seen during past recessions. Historically, such trends have been a precursor to rising unemployment, given that small businesses are the largest employers in the economy. This pattern suggests that the unemployment rate could exceed 5% in the coming months, up from the current 4.4%. If realized, this would mark the highest unemployment rate since mid-2021, during the pandemic recovery period. Small businesses continue to face significant challenges.