With Small Businesses Permanently Changed by the Pandemic, Owners Looking to Vaccine-Driven Recovery PNC Survey Shows
Amid this year’s historic coronavirus pandemic, businesses are adapting by making major changes to their operations including increased use of technology, according to the latest PNC semi-annual survey of small and mid-size business owners and executives, which concluded Sept. 8.
Key survey findings:
Shots In the Arms: Nearly half of those surveyed (48%) plan to require employees to get vaccinated, a third indicated they will provide education about vaccination and almost one quarter (22%) plan to provide incentives to their employees who vaccinate. Almost half (45%) expect the growing availability of vaccinations to have a positive impact on their sales.
Squeeze Is On: The combination of higher operating costs and the anticipation of stable sales suggests small businesses will start feeling even more of a “squeeze” in their operations than they already are experiencing. Almost half (48%) say that they are facing challenges to stay in business and nearly one in four (24%) say they can only continue to operate in the current economic conditions for up to a year. As a result, business owners reported that price hikes may be in store. Among survey respondents, 40% indicated that they plan to increase prices in the next six months, up from fewer than a third in the fall survey.
Change is Forever: Nine in 10 (90%) of business owners report making adaptations to their operations in response to COVID-19, including health and safety changes in the form of new policies and procedures (86%) or physical modifications (78%). Of those, more than two-thirds of businesses said they expect safety changes forced by the pandemic to be permanent. More than half of business leaders (53%) made product-related changes, either in the way they sell or deliver their products or services (51%) or in their product offerings (23%). Over half (54%) of those making product-related changes also expect them to be permanent.
Sluggish Rehiring: Nearly one in four businesses reported that they reduced their workforce last year and while most are not anticipated to be permanent layoffs, rehiring will be a slow process. Of those businesses that took action to cut workers in the past year, eight in 10 (82%) consider the decrease to be temporary or a furlough. More than two-thirds (69%) said the action impacted 25% or less of their workforce. However, the survey measured a record-low proportion of businesses expecting to increase the number of full-time employees (7%) in the next six months.