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Less than half of businesses are fully operational because of COVID-19, and the pandemic remains top of mind for employers as they plan for the future.
The latest Principal Financial Well-Being Index, "Surviving a Global Pandemic by Adapting in Real Time," asked 500 decisionmakers about the current state of business in the United States and how the pandemic is shaping their plans.
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Companies in rural areas have been affected more dramatically, and employers with more than 500 employees are in a stronger position than their smaller counterparts. About one in four businesses is uncomfortable with current cash flow, and about half of the businesses surveyed throughout the pandemic have concerns they will be forced to close permanently.
Southern states reported financial improvement since this time last year, while the Midwest is seeing some stability. Most businesses believe their local economy is stable, although rural businesses are more likely to say that their local economy is declining. Three out of four regions are stable or growing, while 28 percent say the Northeast is declining.
One in five businesses feels unsupported by the federal government as they continue to navigate an uncertain economic situation. Rural businesses were more likely to feel left behind by than those located in urban areas.
Looking ahead, employers are more concerned and cautious about the economic outlook than they were last September. Despite the hardships of 2020, businesses are expecting some level of improvement in their finances during the next 12 months. Employers anticipate recovery to take longer than previously estimated. More than half of metropolitan businesses expect to recover within a year, while the rate is slower for rural businesses. Objectives for the next 12 months focus on close attention to serving customers' needs as a natural way to increase revenue.
Based on current conditions and the outlook for 2021, these are the top priorities for the employers surveyed:
- Staying healthy and/or preventing my employees from getting sick, 42 percent.
- Maintaining customers and/or client relationships, 41 percent.
- Supporting my employees emotionally and mentally during this time, 32 percent.
- Understanding the bigger picture and broader economic forecasts, 30 percent.
- Paying my employees' salaries and/or benefits, 29 percent.
- Managing shifts in ways of working, such as remote work or new tools, 21 percent.
- Retaining my workforce and keeping talent in-house, 20 percent.
- Maintaining business partner and/or vendor relationships, 18 percent.
- Paying rent and bills related to my business, 16 percent.
- Getting paid myself and supporting my own family, 15 percent.
- Managing reduced business operating hours 14 percent.
- Navigating a shift in business model, 12 percent.
- Managing the closure of my business, 10 percent.
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Alan Goforth
Alan Goforth is a freelance writer in suburban Kansas City. In addition to freelancing for several publications, he has written a dozen books about sports and other topics.
