The COVID-19 pandemic is battering every sector of the U.S. economy. While all are suffering, small businesses may be among the harder hit. A new survey from MetLife and the U.S. Chamber of Commerce small business index showed that 43% of small businesses believe they have less than six months before they will have to close permanently.
Nearly a quarter (24%) of small businesses already have shut down temporarily and another 40% say they will have to shut down temporarily within the next two weeks. Almost half (46%) think it will take the U.S. economy six months to one year to return to normal. The survey research was conducted by Ipsos between March 25 and 28, 2020.
There are more than 30 million small businesses (those with fewer than 500 employees) in the United States, and nearly 59 million people who are employed by small businesses.
U.S. Chamber of Commerce Vice President Tom Sullivan said:
Small businesses have taken an enormous hit from the disruption caused by the coronavirus outbreak and we don’t want small businesses to fail because they aren’t aware of what’s being offered. The Chamber has created numerous step-by-step guides to quickly help small businesses access the financial aid they need and better understand the relief available through the CARES Act.
More than half (56%) of small business owners indicated that direct cash payments are the most helpful kind of relief from the effects of the shutdown. Small Business Association (SBA) disaster loans were named by 30% of respondents as being most helpful, and 21% said that temporary cancellation of business payroll taxes was most helpful.
Since the end of December, small business owners’ sentiment on the national economy has dropped from 60% to 25% and from 52% to 32% on their local economies. More than half (54%) rate the overall U.S. economy as “poor.”
By industrial sectors, manufacturing (53%) and retail (54%) small businesses are significantly more optimistic about improved revenues next year than the service (48%) and professional service (46%) sectors.
A previous survey indicated that 30% of small businesses expected to hire more staff this year. That has now dropped to 23%. Only 5% of businesses with fewer than five employees plan to hire any more workers this year.
Of the more than 30 million U.S. small businesses, about 5.3 million employ between one and four people, and more than 24 million have no paid employees.
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