Survey: More than 1 in 3 small businesses won’t survive past the next three months without additional financial relief
For months, Congress and the White House have conducted negotiations on another round of stimulus relief in fits and starts as they struggle to agree on the size and scope of a stimulus package. Small Business Majority’s latest survey reveals that the uncertainty of whether more help will arrive has left too many small businesses on the brink of collapse.
The survey finds that without additional funding, more than 1 in 3 (35%) small business owners will not survive past the next three months. The number is even higher for small business owners of color: an astounding 41% of Black and Latino-owned businesses won’t make it through the next few months without additional financial support. And 1 in 5 small business owners report they’ve considered filing for bankruptcy. These numbers have grown since our last survey was released on August 27, when 26% of small businesses reported they wouldn’t survive more than three months, and 16% reported they’ve considered bankruptcy.
To make matters worse, a wave of commercial evictions and foreclosures is likely on the horizon, with 8 in 10 small business owners reporting that they are struggling to make commercial rent or mortgage payments—up 18% since late August. Slightly more business owners of color (84%) report the same. Equally troubling, 64% of all small businesses and 73% of Black and Latino-owned businesses are concerned they will have to permanently lay off employees without immediate federal relief. More than 6 in 10 Black and Latino small business owners are very concerned they will have to make permanent layoffs, and 10% have already done so.
Given these numbers, it’s clear that small businesses need more assistance in order to survive the pandemic. When asked what the number one priority should be for Congress and the White House before Election Day, small businesses ranked a comprehensive stimulus package as their top concern. Fifty-five percent ranked negotiating on a comprehensive, bipartisan stimulus package that includes small business assistance and unemployment insurance as the number one priority, followed by 29% who want to see a standalone small business relief bill, 5% who want another round of stimulus checks for some Americans and 4% who want see the Supreme Court nominee confirmed.
The need for a comprehensive relief package comes at a time when small business owners are still experiencing a significant loss in consumer confidence. Forty-five percent of small business owners rank reduced consumer demand as the top concern for their business right now. One in five of all small business owners and more than 1 in 4 minority-owned businesses (27%) rank the health and safety of themselves, their employees and their customers as their top concern. Fifteen percent of Black and Latino owned businesses are still unable to reopen their businesses.
Additionally, small business owners are concerned about the future of their healthcare. In November, the U.S. Supreme Court will hear oral arguments in the case of California v. Texas, a case challenging the constitutionality of the Affordable Care Act. Seventy-four percent of all small businesses and 86% of Black and Latino-owned businesses are concerned that the Supreme Court may strike down all or part of the healthcare law, including protections for individuals with preexisting conditions.
The findings of this survey paint a dire picture of what many small business owners are facing just weeks before Election Day. With no sign of an end to the health crisis in sight, small business owners are looking to Congress and the White House to provide more comprehensive relief to sustain their businesses and set our economy on a meaningful path toward recovery.
This is the fifth in a series of COVID-19 related surveys Small Business Majority has released of its network. Over time Small Business Majority has tracked the economic conditions facing small businesses, how well federal stimulus programs have served its network, the small business owners' views of proposed stimulus provisions, and other issues of importance.