In the CNBC/SurveyMonkey Small Business Survey for Q2, only 18% of small business owners reported conditions as “Good.” Fast forward to Q3 and it has doubled to 36%. And when it comes to small business confidence, it is up from 49 to 53 for Q3.
Even though 53 is the second-lowest score ever for the index, it is more optimistic than the previous quarter. And business owners feel they have overcome a formidable challenge and are living to tell about it.
In the release for the report, Jon Cohen, chief research officer at SurveyMonkey, says the latest results offer a glimmer of optimism. But he goes on to say there is a shift in how businesses will operate moving forward. Adding, “Even as seven in 10 small business owners say the pandemic has caused permanent changes in the way they operate, nearly as many of those who made it through the first throes of the crisis express confidence they can survive for a year or more. For many on Main Street, the strong sense is they’ve made it through a paradigmatic shift.”
This shift is forcing small businesses to adopt new technology, find new methods of operation and be more flexible.
CNBC, SurveyMonkey Small Business Confidence – 3rd Quarter
The Small Business Confidence Index (SBCI) is a 100-point score based on responses to eight key questions. The index calculates the responses on a scale from 0-100, with 0 as no confidence and 100 perfect confidence. The responses are from more than 2,000 small business owners ages 18 and up conducted using SurveyMonkey’s online platform from July 20-27, 2020.
In addition to the doubling of how “good” small business owners feel, 64% of them say they can continue operating for more than a year under the current conditions. This is double the number (32%) of the previous quarter. This optimism is in part driven by owners (35%) that say demand for the core product or service of their business is increasing. The number is also double of the previous quarter (17%).
However, 41% of owners say demand for their business has decreased in the past three months. This is taking place even though 58% are remaining open through the pandemic. With fewer people going out, this number is not surprising at all. Additionally, there are costs or losses associated with remaining operational despite the lack of customers walking through the front door. This includes 54% of businesses experiencing higher and unforeseen costs because of COVID-19 safety measures.
With the pandemic still ongoing, a large majority of small business owners or 69% say it will permanently affect how they run their business. This is almost the same (71%) as in the last quarter.
Actions Taken Based on the Pandemic
If there is one thing this survey highlights, it’s the wide range of responses it gets each and every quarter. At the same time, it also shows how similar small business owners are when it comes to dealing with adversity.
A timely question in this survey is: Which, if any, of the following has your business done as a direct result of the COVID-19 outbreak?
The amount of business owners who furloughed some or all of their employees is only 12%. It goes without saying the world ‘only’ has little significance for the people that are furloughed. But considering the economic impact of the pandemic, it is relatively low. A similar number or 13% laid off some or all of their employees also.
Other business owners made due by cutting pay for themselves (32%) or their employees (9%). Again, this shows owners were sacrificing more in order to keep their staff working. But in some cases, even this didn’t help as 23% temporarily closed their business while another 2% did so permanently.
To end on a good note 24% of owners hired all of the workers they furloughed while another 34% hired some of them back.
You can see the result for the full CNBC/SurveyMonkey Small Business Survey for Q3 here.