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RSM US Middle Market Business Index Overview

The RSM US Middle Market Business Index (MMBI) has demonstrated resilience, recording a steady score of 111.8 for the third quarter of 2026. This figure, only slightly down from the previous quarter's 113.6, showcases a robust business climate characterized by rising profits, ongoing investment in businesses, and recent tax reforms that bolster growth and confidence in the middle market sector.

Positive Executive Outlook

In the recent survey, a strong sense of optimism has emerged among middle market executives, with 68% predicting growth in revenue and net earnings over the next six months. In parallel, 58% foresee an overall improvement in the economy. Notably, 43% of executives reported that current economic conditions have improved, while 58% indicated an uptick in revenues and 59% saw an increase in their net earnings.

Increased Capital Expenditures

As businesses seek to adapt to a rapidly evolving economic landscape shaped by artificial intelligence (AI), many are ramping up capital expenditures. In the third quarter, approximately 57% of respondents disclosed increased spending on capital initiatives, with 65% expecting to elevate expenditures in the following half-year. Joe Brusuelas, Chief Economist at RSM US LLP, remarked, "This trend of heightened capital spending signals a significant shift towards productivity-enhancing investments that will help businesses compete in an AI-driven market."

Workforce Investments

Investment in workforce remains paramount, with over half (54%) of the surveyed executives reporting increased hiring during the current quarter. Moreover, 60% plan to expand their workforce in the approaching six months. Significantly, 57% also indicated they have raised employee compensation recently, with 66% expecting further increases soon. This commitment to workforce investment underlines the middle market's strategy to foster growth while adapting to new economic realities.

Addressing Inflationary Pressures

While optimism thrives, inflation remains a pressing challenge. A striking 75% of businessmen reported facing higher prices, and 76% expect this trend to continue. To cope with the resultant cost pressures, many firms are resorting to a combination of margin compression and price adjustments downstream. In fact, around 66% indicated they raised prices in the current quarter, and 70% plan to do so within the next half-year.

Survey Methodology

The insights presented herein are derived from a survey conducted with 501 middle market firms across the U.S. from July 7 to July 29, 2026. The MMBI is based on a composite of 20 key business indicators, including changes related to revenues, profits, capital expenditures, hiring trends, and pricing pressures. This survey serves as an essential resource to gauge the health and outlook of the middle market, continuing its trajectory since its inception in 2015.

Conclusion

As the American middle market navigates through current economic landscapes marked by technological shifts and inflation, the RSM US Middle Market Business Index illustrates that optimism persists. Businesses are not only planning for growth but actively investing in both people's potential and capital initiatives to assure their competitive positioning and relevance in a fast-evolving environment. Enhancing productivity through significant capital investment will likely be a hallmark of enduring success in the middle market area for years to come.