The National Federation of Independent Business (NFIB) Research Center released its latest COVID-19 survey on the impact the pandemic has had on small businesses. This survey marks NFIB’s 16th survey in the series, which started in early March 2020. Thirteen percent of small business owners report that they will have to close their doors if current economic conditions do not improve over the next six months, down from 25 percent in December.
“After a year of the COVID-19 pandemic and the challenges that came with it, small business owners are working hard to see a brighter future for their businesses,” said Holly Wade, Executive Director of NFIB’s Research Center. “Economic conditions seem to be easing for some, but the overall recovery remains uneven across small business industries. It is crucial that small businesses are given the resources and flexibility needed to ensure they will have a successful recovery.”
Key findings from the survey include:
- Almost three-quarters (74 percent) of 2020 Paycheck Protection Program borrowers have applied for loan forgiveness.
- The Consolidated Appropriations Act of 2021 (CAA) reopened the PPP application and of those owners who did not receive a first-draw PPP loan in 2020, 20 percent have applied for a first-draw PPP loan.
- Of those businesses who received a first-draw PPP loan in 2020, 42 percent have already applied for a second-draw PPP loan and 2 percent are planning to apply for one.
- Seventy-eight percent of those who have applied for a second-draw PPP loan have been approved and 1 percent were denied.
- The 25 percent reduction in gross eligibility rule was the main factor for about three-fourths of those first loan PPP borrowers in not applying for a second-draw PPP.
- The America Rescue Plan Act of 2021 extended the Employee Retention Tax Credit (ERTC) through the end of 2021, however, still very few employers know that it exists.
- Sales levels are 50 percent or less than they were this time last year (2020) for 22 percent of small businesses with another 21 percent at sales levels of 51 percent-75 percent of pre-crisis.
- Thirteen percent of small business owners report that they will have to close their doors if current economic conditions do not improve over the next six months, down from 25 percent in December.
- The economic outlook has improved slightly over the last few months with 11 percent of owners reporting that conditions are back to normal now, a six-percentage point improvement from late January.
- Almost half (44 percent) of owners have had an employee take COVID-19 related sick or family leave.
- As more of the general population are eligible to get the vaccine, 45 percent of small employers will encourage their employees to get vaccinated and 2 percent report that they will require their employees to be vaccinated.
This publication marks NFIB’s 16th Small Business COVID-19 survey assessing the health crisis impact on small business operations, economic conditions, and utilization of the targeted small business loan programs. The first series was published in early March 2020 with subsequent publications every 2-4 weeks, found here. The full survey of the 16th edition is available here.