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Two-thirds of small businesses are not confident they will fully recover from the pandemic-caused economic downturn, according to a mid-June survey taken by the National Small Business Association (NSBA).
This is despite the fact that 80% of respondents applied for some kind of federal lending program, and among those, 96% were approved for either an Economic Impact disaster Loan (EIDL) or Paycheck Protection Program (PPP) loan, or both. At the start of June, many states were either fully re-opened, or on a path to re-opening, and the small-business outlook was on the way to rebounding from historic lows in April.
The COVID-19 survey from NSBA, taken among 630 small-business owners from across the country, shows that small-business confidence, economic outlook and overall impact of the pandemic have improved over the last two months. Nearly half of respondents have between 1 and 5 total full-time employees, and about 40% are from the professional, scientific, technical services, and manufacturing sectors.
However, we could witness a reversal of these positive trends, warns the survey, if small-business owners lack confidence in the ability for our country to recover, which is essential for growth, investment, and job creation. Over half of small businesses report they are bracing themselves for a second wave of COVID-19.
About 70% of small businesses say they are very concerned about the coronavirus, down from 85% two months ago, although 80% of the businesses report they have not had any known cases of COVID-19 in their business, according to the survey.
Over half, 64% of small-businesses, say they are still experiencing reduced customer demand, according to the survey. And, one-in-four small-business owners report they have not yet been able to fully re-staff their business.
Eighty-two percent of small businesses made workspace changes as a result of the pandemic, such as social distancing requirements and providing sanitization. The average initial set-up costs were $11,729, with ongoing monthly costs averaging around $1,800.
Also, about a third say they are still affected by delays or closures in the supply chain.
Mid-size businesses may be faring better, according to the Principal Financial Well-Being Index: Business Owners, published in July.
The Index surveyed 500 business decision makers from companies ranging from 2 to 10,000 employees, for a deeper look at how COVID-19 has affected the way they do business, their workforce, and recovery plans.
In the Principal survey, 40% of businesses reported their current state of business financials are "stable," while 41% reported they are "growing," according to the Index. Although, "the economic impacts of COVID-19" remains the chief concern among employers.
Midsize businesses reported stronger growth rates, according to the Index, with 34% of businesses with 2 to 499 employees reporting they are "growing," while 53% of businesses with 500 to 10,000 employees reporting they are "growing."
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