PITTSBURGH, March 1, 2021 /PRNewswire/ -- Small and
mid-sized business owners strongly support vaccinations for
COVID-19 and plan to encourage their employees to get the shots,
which are central to a return to normalcy, according to the latest
PNC semi-annual national small business survey, which concluded
Feb. 2.
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.
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.
"Clearly, small and mid-sized business owners have high hopes
that successful adoption of vaccinations by the public will
translate into an improved business environment, but many
challenges remain in front of them," said PNC Chief Economist
Gus Faucher. "As we saw in our
survey last fall, business owners remain resilient as they adapt to
the massive economic changes the pandemic has caused, and they
expect most of these changes to be genuinely transformative."
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.
Further, 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.
"Business owners indicated that they will have to cope with
these challenges in two ways that are potentially harmful for the
broader economic recovery, slowing the rate of hiring and
increasing prices for their customers," Faucher said.
Other key survey findings include:
- Left Behind: Small business owners are not yet
feeling part of the broader economic recovery. Their optimism is
growing about the U.S. economy and their local economies, but
slower growing when it comes to their own business.
- Back to Work: While the pandemic necessitated a major
shift to work-from-home policies, these are unlikely to remain
permanent. Nearly half of business reported shifting to
work-from-home, but only a fraction (15%) anticipate the change to
be long-lasting, while 59% expect it to be temporary with the
remainder unsure.
- PPP Remains Critical for Survival: More than four
in 10 businesses (43%) received PPP funding in 2020; another 6%
applied for but did not receive the funding, while the remainder of
businesses did not apply. Three-quarters (76%) of those who
received a PPP loan considered it extremely important. More than
four in 10 business leaders (43%) considering obtaining a new 2021
PPP loan view it as extremely important for their
business.
- New Tech Provides Lifeline: More than half of business
leaders (56%) report increased use of one or more technologies
since the outbreak began. Three in 10 (30%) have increased use of
technology to improve workforce productivity. More than a third
(38%) applied new technologies to improve the sales process in the
form of electronic or touchless payment systems (29%) or
electronic/website-enabled sales (23%).
National and regional survey results are available at
pnc.mediaroom.com.
The PNC Financial Services Group, Inc. (NYSE: PNC) is one of the
largest diversified financial services institutions in the United States, organized around its
customers and communities for strong relationships and local
delivery of retail and business banking including a full range of
lending products; specialized services for corporations and
government entities, including corporate banking, real estate
finance and asset-based lending; wealth management and asset
management. For information about PNC, visit www.pnc.com.
Methodology
The PNC Economic Outlook survey was
conducted by telephone from 1/2/2021 to
2/2/2021, among small and mid-sized businesses with
self-reported revenue of $100,000 to
$250 million. 500 interviews were
conducted nationally. Sampling error for the nationwide results is
+/- 4.4% at the 95% confidence level. The survey was conducted by
Artemis Strategy Group (www.ArtemisSG.com), a communications
strategy research firm specializing in brand positioning and policy
issues. The firm, headquartered in Washington D.C., provides communications
research and consulting to a range of public and private sector
clients.
DISCLAIMER: This report was prepared for general information
purposes only and is not intended as specific advice or
recommendations. Any reliance upon this information is solely and
exclusively at your own risk. NOTE: The sum of percentages may not
add to the total due to rounding.
CONTACT:
Alan Aldinger
(412) 370-3887
alan.aldinger@pnc.com
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SOURCE The PNC Financial Services Group, Inc.