by Ted O’Neil
Some two-thirds of small business owners say more federal relief funds are needed for them to be successful in the coming year during the ongoing coronavirus pandemic, according to the fourth quarter Small Business Index survey from the United States Chamber of Commerce.
Small business owners who participated in the survey said they would use the money to pay for employee salaries and benefits, operational costs and rent and utilities.
Overall, the index stands at 52.9 for the fourth quarter, up slightly from 50.3 in the third quarter and significantly higher than 39.5 in the second quarter when the pandemic hit. Pre-coronavirus, the index was 71.7 in the first quarter of 2020.
Dealing with the coronavirus and the economy tied for first – at 44 percent each – among the top policies small businesses think the incoming administration of President-elect Joe Biden and the new Congress should focus on in 2021.
“Most small businesses have had a tough year and need immediate assistance from Congress,” said Tom Sullivan, vice president of small business policy at the Chamber. “A legislative stimulus should be targeted toward the struggling businesses that need a financial bridge to survive the pandemic.”
Sullivan also noted that federal assistance should be flexible enough to fund personal protection equipment purchases and provide legal protections for companies that followed guidelines from the Centers for Disease Control and Prevention to protect their employees and customers from coronavirus.
“It’s the best way to ensure small businesses can get back on their feet and are there to help energize the economy when things start to return to normal,” he added.
The Coronavirus Aid, Relief and Economic Security Act, also known as the CARES Act, allocated $2.2 trillion in federal relief funding when it was signed into law by President Donald Trump in March. Of that, $659 billion was put toward the Paycheck Protection Program for small businesses to fund up to eight weeks of payroll costs.
Most small business owners, 52 percent, say they will maintain their current number of employees in 2021, while 27 percent said they expect to increase staff size. More plan to reduce staff size, 14 percent, compared to 9 percent in the last quarter.
Overall, 29 percent of small business owners describe the nation’s economy as being in good shape, up from 22 percent in the third quarter but down significantly from 57 percent in the fourth quarter of 2019.
Half of small business owners said they see their operations continuing for a year or less in the current economic climate before having to close permanently.
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