Some consider small businesses the lifeblood of the American economy. On Tuesday, we learned that small-business owners are more optimistic about the economy than they’ve been all year, according to the National Federation of Independent Business.

But compared to the historical average, optimism is still down. And that’s kind of the way it’s going for businesses these days: some roses, some thorns.

The thorniest part of running a small business today? Inflation.

“We see the inflation in everything, right?” said Sheena Eizmendiz, who runs her own small business, The WellBiz, a consulting firm in Miami.

“Our workers’ comp just went up right now. They just increased it,” she said. “We also see that increase when it comes to health care. Across the board, we’re seeing it everywhere.”

Workers are also getting paid more. Small businesses may be facing an easing labor market, but it remains tight, said Holly Wade, lead researcher at the NFIB.  

“We’re still seeing very elevated levels of business owners saying that they’re planning to increase compensation,” she said. “And business owners are then having to try and figure out the best ways of absorbing those cost increases.”

Bob Kingery has felt that pressure at his Raleigh-based company, Southern Energy Management, which installs solar panels and makes buildings more energy-efficient.

“Our hourly team members that do our field work in the last three years, we’ve focused heavily on how are we going to increase their wages, so they can afford to live in the Triangle area of North Carolina or anywhere in North Carolina, for that matter,” he said.

Kingery is paying his employees more, but he said that he’s not having trouble hiring overall and hasn’t had to put off any large purchases.

“We are optimistic. It’s kind of rare, rare, rare to feel that way in the world around us,” Kingery said.

And there are signs in Tuesday’s survey that the economy may not be as bad as some business owners feel it is.

“The hard indicators have been pretty good. And the soft indicators, people’s expectations and their assessment of the situation, has gone way down,” said Liz Wilke, a principal economist at payroll firm Gusto.

She said there’s a growing gap between how business owners are actually doing and how they feel about the future.