The U.S. Census Bureau: Small Business survey results were released recently, and my team and I took a deep dive in to see how small businesses in the U.S. are faring this year. The obvious “elephant in the room” of 2020 is COVID-19, which has undeniably affected businesses. The most interesting finding, however, is that not all of these effects are negative, nor entirely detrimental to business.
The main takeaway is that businesses are changing how they operate, which can be both good and bad. One trend is that many businesses are shifting to remote work, which is something our company also did, and continues to do. It certainly created new challenges for us, but building remote work systems has made us a more flexible, and therefore stronger, company. Plus, seeing how everyone was able to shift to the new system so quickly made me confident we can adjust to any change. I am proud of what our team was able to accomplish during these hard times. Even though the pandemic posed a major challenge, we found that, like Hughes Capital, fewer businesses are reporting major negative effects, and more are reporting moderate negative effects. We can assume this means that, while not ideal, companies are learning to stay afloat. Overall, businesses are becoming smarter at weathering the storm, which is a good thing in the long-run.
We took some data from the most recent survey results and summarized some additional interesting findings.
• Unsurprisingly, not many states are reporting a benefit from the coronavirus, with Michigan’s small businesses reporting the highest “large positive effect” of 2.6% (1.1% over the national average).
• Tennessee has the highest “moderate positive effect” at 8.5%
• Montana is reporting the highest “little to no effect” at 36.1%
• Mississippi has the highest “moderate negative effect” at 55.1%
• Hawaii is reporting highest “negative effect” at 49.7% (with New York in close second at 47%)
• Utah reported the largest increase in a shift to remote workers at 6.6% (3.5% higher than the national average), with Georgia, New York, and North Carolina reporting the smallest increase in a shift to remote workers at 2.0% or lower.
• Alabama had the highest percentage of reported delays or difficulties in shipping to customers of 27.2% (9.2% higher than the national average)
• Maine, Alabama, and Iowa reported the highest percentage of requests for assistance from the Paycheck Protection Program (PPP) at 80.5% or higher, while Maine, Alabama, and Louisiana received the most PPP assistance at 79.7% or higher.
• The three states with the highest percentage of small business with no cash available for operations are New York (5.7%), Arizona (5.2%), and Nevada (4.8%).
• But not all New York news is bad: They also have the highest percentage of employees being rehired at 11.3% (5.6% above the national average).
So, with all these effects, are small businesses still making money?
It probably comes as no surprise that the national average for decreased revenue ran high, at 34.2% of small business. But, that also means that more than half of the business surveyed are faring just as they were before the pandemic hit — and some are even doing better. The national average for increased revenue runs at 8.9%, with South Dakota, Montana, and Michigan reporting the highest increase in revenue, affecting around a reported 13% of their small businesses.