Survey: 49% of Small Busines Owners Expect Their Operations to Recover in 2022 or 2023

Most small business owners do not expect business conditions to improve to normal levels until next year at the earliest, according to a new survey from the National Federation of Independent Businesses, or NFIB, which has a Michigan chapter based in Lansing.
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COVID-19 economic dip graph
Most business owners think their business conditions will improve to normal levels in 2021 at the earliest, according to a survey from the NFIB. // Stock photo

Most small business owners do not expect business conditions to improve to normal levels until next year at the earliest, according to a new survey from the National Federation of Independent Businesses, or NFIB, which has a Michigan chapter based in Lansing.

Based on the survey, 4 percent of small business owners report their operations are now back to normal, while 47 percent anticipate their companies will rebound in 2021. Another 36 percent anticipate they will recover fully in 2022, and 13 percent are less optimistic and don’t expect conditions to full improve until after 2022.

As more of the general population are eligible to get the COVID-19 vaccine, 36 percent of small business employers will encourage their workers to get vaccinated, and 28 percent report that they might encourage them to do so. More than (56 percent) of small business owners plan to get vaccinated, while 28 percent say they’ll get vaccinated as soon as it’s available to them and 28 percent report they will get vaccinated, but not right away.

“As we head into the winter months in Michigan, the ability for small businesses to use outdoor venues as a way to limit the spread of the virus will diminish and contribute to a further deterioration in revenues,” says Charlie Owens, NFIB Director in Michigan. “As the legislature and the governor continue to grapple with state assistance for small business, it is clear that the magnitude of the Michigan situation will require more federal relief.”

Key findings from the survey include:

  • The majority of Paycheck Protection Program borrowers (91 percent) have spent their entire PPP loan.
  • If eligible, 45 percent of small business owners would apply or re-apply for a second PPP loan and 33 percent would consider applying.
  • Significantly more borrowers have submitted their PPP loan forgiveness application over the last month – 44 percent of owners have submitted one, up from 26 percent last month.
  • Thirty-six percent of PPP borrowers are not yet ready to submit their forgiveness application and 20 percent are ready but their bank is not yet accepting them.
  • Almost half of small business owners who have submitted a PPP loan forgiveness application have received final confirmation from the SBA and over three-fourths of them had 100 percent of their loan forgiven.
  • Sixteen percent had 99-91 percent of their loan forgiven and 6 percent received less.
  • Receiving an EIDL grant was the reason for 85 percent of those who did not receive 100 percent forgiveness on their PPP loan.
  • Of those PPP borrowers who have not submitted their forgiveness application yet, 56 percent report that they plan to submit it by the end of the year.
  • Twenty-two percent plan to submit their application in January and another 6 percent in February.
  • After using the PPP loan, 22 percent of borrowers have or anticipate having to lay off employees in the next six months, a slight increase from 19 percent a month ago.
  • About half (53 percent) of borrowers anticipate needed additional financial support over the next 12 months.
  • Twenty percent of PPP loan borrowers find that the forgiveness application was difficult or moderately difficult process.
  • Twenty percent found the process slightly difficult and 19 percent said the process was not at all difficult.
  • About one-third (34 percent) of small business owners have applied for an Economic Injury Disaster Loan (EIDL).
  • Eighty-two percent of applicants had their loan approved and 8 percent of applicants were denied.
  • One-in-five small business owners have applied for a state or local grant.
  • Fifty-three percent of owners received one.
  • Nineteen percent of small employers reported they have fewer employees than they did this time last year and 11 percent have significantly less.
  • Eight percent of small business employers report that their current number of employees is more than they employed this time last year.
  • Almost two-thirds (63 percent) of small employers report their workforce numbers are about the same.
  • Sales levels are still 50 percent or less than they were pre-crisis for one-in-five (20 percent) small businesses with another 29 percent at sales levels of 51 percent-75 percent of pre-crisis.
  • Over one-third (36 percent) are back or nearly back to where they were with sales between 76 percent-100 percent of pre-crisis levels with another 14 percent exceeding pre-crisis sales levels.
  • Twenty-seven percent of small employers have had an employee take COVID-19 related paid sick leave or family leave as mandated and offered through the Families First Coronavirus Response Act (FFCRA).
  • Only 37 percent of them have claimed the tax credit or an advance refund for reimbursement of those costs.
  • About one-in-five (19 percent) of small employers are very concerned about their employees contracting COVID-19 with another 30 percent moderately concerned.
  • Thirty-one percent of owners are very or moderately concerned about contracting COVID-19 themselves while operating their business.

The latest results marks NFIB’s 14th 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 full survey of the 14thedition is available here.

For more than 75 years, NFIB has been advocating on behalf of America’s small and independent business owners, both in Washington, D.C., and in all 50 state capitals. NFIB is nonprofit, nonpartisan, and member-driven. For more information, please visit nfib.com.

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