Middle market companies embracing cautious approaches amid declining confidence and rising costs
COLUMBUS, OHIO — New data from the National Center for the Middle Market (NCMM) reveals that while U.S. middle market companies continue to grow, that pace of growth slowed significantly in the first half of 2025. The latest Middle Market Indicator (MMI) shows that year-over-year revenue and employment growth rates dropped to their lowest levels since the post-pandemic recovery began in late 2021.
Despite 84% of companies reporting revenue growth, the average rate has declined to 10.7%, down from 12.1% at the end of 2024. Employment growth has also slowed, with only 54% of companies expanding their workforce at an average rate of 7.3%, compared to 10.3% just six months ago.
Economic confidence has taken a notable hit, with national confidence falling 11 percentage points since the close of 2024. This decline is reflected in reduced expansionary activity and a growing preference among executives to hold cash rather than invest. Only 35% of companies now say they would invest an extra dollar, down from 44% previously.
Middle market leaders cite inflation, rising costs and uncertainty around tariffs and trade policy as the most significant headwinds. These challenges have led to a more cautious approach, with fewer companies introducing new products, entering new markets, or taking on new debt.
“After remarkably consistent high growth out of the pandemic, we are seeing a clear slowdown across the middle market,” said Doug Farren, executive director of the NCMM. “While the overall performance is still strong, uncertainty around cost of doing business, particularly as it relates to lingering inflation, high interest rates and fluctuating trade policies has created uncertainty which is driving a pause in decision-making and much lower projected growth.”
Still, optimism persists. Four out of five companies say performance is better today than one year ago, and nearly two-thirds anticipate continued revenue growth over the next 12 months — albeit at a slower rate of 8.1%. Customer acquisition and increasing sales remain top strategic priorities.
About the Middle Market Indicator (MMI)
The MMI, which was first launched in 2012, surveys 1,000 CEOs, CFOs, and other C-suite executives of America’s middle market companies on key indicators of past and future performance in revenue, employment, and allocation of cash. The survey also reports middle market company confidence in the global, U.S., and local economies and identifies key business challenge areas. The survey was designed to accurately reflect the nearly 200,000 U.S. businesses with revenues between $10 million and $1 billion, the lower and upper limits of middle market annual revenue. The survey is designed and managed by the National Center for the Middle Market. The most recent survey reflected in this report was fielded in June 2025.
About the National Center for the Middle Market (NCMM)
The National Center for the Middle Market is a research center housed at The Ohio State University Fisher College of Business. exists for a single purpose: to ensure that the vitality and robustness of middle market companies are fully realized as fundamental to our nation’s economic outlook and prosperity. The center is the leading source of knowledge, leadership and innovative research on the middle market economy, providing critical data analysis and insights for companies, policymakers and other key stakeholders. The NCMM is fully committed to dynamically creating new knowledge, providing programs that drive value for middle market companies and offering a well-informed outlook on the health and future of the middle market via the Middle Market Indicator. The NCMM and its Middle Market Indicator are generously funded by Chubb, Visa and Wells Fargo.
About The Ohio State University Max M. Fisher College of Business
The Ohio State University Max M. Fisher College of Business provides tomorrow's business leaders with the foundation needed to succeed in business today. Fisher students experience an academically rigorous learning environment, led by world-class faculty, which fosters their development as principled leaders who possess an entrepreneurial spirit, global awareness and a commitment to social responsibility. Organizations from around the globe thrive under the leadership of Fisher alumni, who positively impact their communities and the world.