Owning and successfully operating a small business can be difficult and challenging even in the best of times. Getting a handle on where things are and what the future may hold can be a tricky thing. At the end of every month, the National Federation of Independent Businesses takes the pulse of the nation’s small businesses. The following data is taken directly from their recently published report:
- This survey was conducted with a random sample of 20,000 NFIB members from
NFIB’s membership database of about 300,000 small business owners. The survey
was conducted by email from June 26-30, 2021.
- While the economy is surging ahead for many due to strong consumer spending,
the recovery remains uneven across the small business sector. Some small
businesses are still waiting for consumers to return to their industry sector, while
others are saddled with aggravating supply chain disruptions or challenges filling
open positions that are slowing sales opportunities.
- Sales levels are 50% or less than they were pre-crisis levels for 16% of small
businesses with another 21% at sales levels of 51%-75% pre-crisis. Thirty-six
percent are back or nearly back to where they were with sales between 76%-100%
of pre-crisis levels. About one-in-four (26%) are exceeding pre-crisis sales levels.
- Twenty-two percent of small business owners report that economic conditions are
back to normal now in their area. A significant improvement from the previous
survey results reported in late April. Another 27% of owners anticipate it taking until
the second half of 2021 and 22% anticipate sometime in the first half of 2022
before economic conditions return pre-crisis levels. Seventeen percent of owners
are less optimistic and expect conditions not to fully improve until the second half
of 2022 and 13% after 2023.
- About three-fourth (73%) of small business owners report that they will be able to
operate for more than a year in current economic conditions. On the other end,
12% of owners report that they will only be able to continue business operations
for six months or less under current economic conditions and another 15% for 7-12
- Supply chain disruptions are becoming increasingly challenging for many, with over
half (54%) of small business owners who are experiencing disruptions saying that
the supply chain disruption is worse now than it was three months ago. Forty
percent reported about the same level of disruption from last quarter and 6%
reported it easing up from three months ago. And for many, the disruptions are not
likely to ease up anytime soon. Over half (62%) of small business owners anticipate
the supply chain disruption that is impacting their business to continue for five or
more months. Seventeen percent reported between one and four months and only
1% reported less than one month.
- The labor shortage is another challenge facing many small employers. While the
unemployment rate has declined precipitously since the initial mass layoffs at the
beginning of the pandemic, there are still 7 million fewer employed people now
than in February 2020. Twenty-two percent of small employers are currently
experiencing a significant staffing shortage and another 18% are currently
experiencing a moderate staffing shortage. Twenty-one percent reported having a
mild staffing shortage and 39% had of small business owners report no staffing
- Of those small employers currently experiencing a staffing shortage, 19% are
experiencing a significant loss of sales opportunities and 30%, a moderate loss of
sales opportunities because of the shortage. Thirty-two percent are experiencing a
mild loss of sales opportunities and another 19% had no loss of sales opportunities,
able to navigate the staffing shortage by adjusting business operation to
accommodate current sales levels.
- The labor shortage is not easing for most small employers as many potential
applicants have not yet reentered the labor market. About two-thirds (67%) of small
employers reported that their current staffing shortage is about the same as it was
one month ago. A quarter (25%) of small employers reported it being worse, and a
mere 6% reported their current staffing shortage is better than it was one month
ago. Two percent of respondents did not have a staffing shortage one month ago.
-Written by Kevin Sawyer