Even With Government Aid, U.S. Businesses Struggling
The National Federation of Independent Businesses (NFIB) recently released the results of a survey of more than 550 U.S. small businesses. The findings show these firms are still struggling to recover from nationwide shutdowns earlier this year and many could use additional aid from the federal government to help them navigate the COVID crisis.
In fact, 22 percent of the businesses that took Paycheck Protection Program loans from the U.S. Small Business Administration still anticipate having to lay off employees in the next six months unless they are able to get additional financial assistance. Nearly half (49 percent) said they anticipate needing additional financial support over the next 12 months.
Why do these companies need support? One-fifth (21 percent) reported that their sales levels are still 50 percent or more below where they were before the coronavirus pandemic hit the United States. Twenty-eight percent reported sales levels at 50 percent to 74 percent of their pre-crisis levels and only 37 percent said their sales are between 75 percent and 100 percent of pre-crisis levels. (Seventeen percent said their sales are doing better than they were before the pandemic.)
Small business owners also indicated they are uncertain about how the recovery will proceed over the next year or more. Only 10 percent said they anticipate conditions improving to normal levels by the end of 2020 Sixty percent said it will take until sometime in 2021 to fully recover while 20 percent said they don’t expect their operations to hit pre-pandemic levels until sometime in 2022.
The NIFB concluded, “It has been over six months from the onset of the health crisis and many small businesses are still struggling to survive, trying to reduce costs and adjust business operations accordingly. … The health crisis is not impacting small businesses equally but the abrupt shifts in consumer spending, whether adjusting to slower sales or spending spikes, managing consumer and employees’ health and safety, and complying with new government mandates, are creating added stress for most small business owners.”
Click here to read the full survey, which was taken from September 28-30, 2020.