U.S. Chamber Small Business Poll Shows Many Preparing for ResurgenceAugust 3, 2020
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Almost 90% report their businesses are open in some capacity. 23% of small businesses report having temporarily closed at some point, unchanged from the end of May. In total, 86% of small businesses report that they are fully or partially open.
Services and retail slightly more likely to remain closed. By sector, slightly fewer services and retail businesses are open (82% each) compared to manufacturing (87%) and professional services firms (92%).
Businesses remain concerned about the impact of a second wave of coronavirus. 65% of businesses are concerned about having to close their business, or stay closed, if there is a second wave of COVID-19.
Majority of small businesses report actively preparing for resurgence of coronavirus. The most common preparatory actions include purchasing additional supplies to prevent shortages, updating their website and/or social media profile, and increasing e-commerce or digital payment options.
PPP loan recipients concerned about loan forgiveness. One in five (19%) respondents report applying for, and receiving, a PPP loan. Among loan recipients, nearly two-thirds (64%) are concerned about meeting the criteria necessary to receive loan forgiveness.
Those who laid off employees see months before they can rehire. Small businesses are more likely to report having fewer employees (21%) than more (11%) when compared to before the pandemic began. Among those with less employees, 48% say it could be anywhere from three months to a year before they anticipate rehiring most of their employees.
Long-term hiring expectations on the rise. However, more small businesses expect to increase staff in the next year compared to last quarter (30% now, versus 23% in May).
More plan to increase investment next year. 35% of small businesses report plans to increase investments in the upcoming year, up eight percentage points from late May. This is nearly double the number that report plans to reduce investments (18%).
Competition on the rise. Nearly one in three (31%) small businesses report facing more competition from smaller or local companies compared to six months ago—a 10 point increase from late May.
Across the country, more small businesses report reopening and have cautious optimism about the future despite concerns about a resurgence of the coronavirus according to the latest MetLife & U.S. Chamber of Commerce Small Business Coronavirus Impact Poll.
The survey focused on the ongoing impact from the coronavirus. This month, more small businesses say they are open, mostly due to an increase in businesses saying they are fully open. Small businesses that temporarily closed at some point since the pandemic began are more likely to say that they reopened this month (69%) than in late May (43%). This month, 86% of small businesses surveyed report they are either fully (52%) or partially (34%) open, up seven points from 79% in May.
Still, most small businesses are concerned about financial hardship due to prolonged closures (70%) and more than half worry about having to permanently close (58%). This month, more expressed concern over the lack of guidance on proper reopening procedures, up eight percentage points from late May (56% vs. 48% in May).
Though small businesses are pressing onward, concern over a second wave remains high. Two-thirds of small businesses (65%) are concerned about having to close again or stay closed if there is a second wave of COVID-19. Concern is particularly high among small businesses that already had to temporarily close (85%). The most common actions taken to prepare for a second wave are purchasing additional supplies or products to prevent a future shortage (32%), updating websites or social media profiles (29%), and increasing e-commerce or digital payment options (25%).
When it comes to the economy, perceptions of the national economy have steadied after declining sharply earlier this year. Though the overall number saying the national economy is in poor health is unchanged, slightly more say it is “very poor” compared to late May (24% now vs. 18% then). At the other end of the spectrum, 28% say the national economy is “good” (statistically similar to 24% who said the same in May).
Fewer small businesses perceive their local economy as in poor health (39%) when compared to the national economy (55%). Overall, small business views of the local economy are steady: 31% view their local economy as in “good” health compared to 28% in May. 39% see the local economy in “poor” health, statistically unchanged from May (38%).
55% of small businesses report good overall health, statistically similar to what was seen in late May (53%). In comparison, 65% reported being in good health in the first quarter of this year.
Comfort with cash flow holds steady this month (55% reporting comfort now versus 56% late May), although significantly below historical readings (above 80% in each quarter of 2019).
Over the long term, small businesses show signs of guarded optimism, but feel it will be some time before things return to normal. More than half of small businesses believe it will take six months to a year before the small business climate returns to normal (56%), in line with late May’s 55%. Another 7% think that it will never return to normal.
More than half expect next year’s revenues to increase (53% vs. 50% in May and 47% in April), while 18% expect them to decrease. Small businesses are now more likely to report plans to increase investments in the upcoming year (35%), up eight percentage points from May.
Staffing levels are in flux. 60% of small businesses report maintaining the same size staff over the last year (down from 67% in May), 20% report increasing staff over the same period (up from 13% in May), and 17% report decreasing staff during that time (similar to 18% in May). However, hiring expectations are somewhat improved: More small businesses anticipate increasing staff in the next year, up seven percentage points (30% versus 23% in late May).