The small business recovery has sputtered in recent weeks amid growing concerns about a second wave of the pandemic, according to the July Small Business Coronavirus Impact Poll released by the U.S. Chamber of Commerce and MetLife. Meanwhile, in response to the economic impact of the virus, the Chamber is asking Congress to act promptly to provide targeted, temporary assistance and clear reopening guidance for America’s small businesses.
“I would say that the current health of the U.S. economy is concerning. We are fortunate to be in the business that we are in [vacation rentals], however many of the Main Street establishments are facing permanent closure, which will have far reaching effects in the greater community,” said Rhonda Sideris, owner and president of Park City Lodging in Park City, Utah. “95% of our income is realized between Dec. 25 and April 1, so saving winter is a big priority for our entire industry and our town.”
After retreating from record lows earlier this spring, key measures like perceived business health and cash flow have stalled, and the number reporting concern around reopening guidance has increased. Nevertheless, small business owners remain optimistic with regards to future revenue and bullish on hiring and investment plans, the survey found.
Small businesses reporting good overall health (55%) is down 14 percentage points from the end of 2019. The number of small businesses that say they are in poor health (18%) has held flat in this month’s report and is roughly double the number that reported the same prior to the pandemic. Those reporting they are not comfortable with their cash flow (45%) is at a level three times higher than pre-pandemic levels.
“The survey indicates small businesses have reached stable, but significantly lower perceptions of their health and of the health of the wider economy compared to before the pandemic began,” said Tom Sullivan, U.S. Chamber of Commerce vice president of small business policy. “It’s a long road to recovery. Their cash flow concerns, in particular, indicate many small businesses still face serious challenges meeting their monthly expenses like payroll, utilities, and rent.”
In light of these results and the unprecedented dip reported in national GDP, the Chamber is recommending Congress act immediately by passing specific legislative proposals offering targeted, temporary, and timely assistance and liability protections for America’s Main Street businesses.
“This jarring news should compel Congress to move swiftly to provide targeted and temporary assistance to unemployed Americans, employers, and state and local governments, and liability protections for businesses who follow public health guidelines,” U.S. Chamber of Commerce Executive Vice President and Chief Policy Officer Neil Bradley said. “The stakes could not be higher, and the time to act is now. We strongly urge Republicans and Democrats to come together now and enact the relief American workers, families, and employers need.”
Small businesses are also adapting. Sideris said her company had implemented major changes in how they conduct business.
“We have completely overhauled our housekeeping procedures to address the risk of COVID-19 and mitigate it as much as humanly possible,” Sideris said. “Our marketing strategy has shifted as well. Historically we have been a fly-to destination, now we are mainly focusing on the drive market, which we have extended to 15 hours away.”
The report also found that small businesses are looking for more guidance on reopening. This month, more expressed concern over the lack of guidance on proper reopening procedures, up eight percentage points from the previous report released in June (56% vs. 48%).
“Main Street needs assurances from Washington that small business will remain a priority in rebuilding America’s economy.” said Sullivan. “It’s a long road to recovery, but SBA loan assistance and nation-wide liability protections will help small businesses get back up and running at full speed.”
The Small Business Coronavirus Impact Poll is a special monthly coronavirus report, separate from the quarterly MetLife & U.S. Chamber of Commerce Small Business Index. Research for the report was conducted by Ipsos from July 9 – 16, 2020. To read the full report, visit uschamber.com/sbpoll.