SHRM surveys look at the impacts of COVID-19 lockdown on US small businesses
- Published: Friday, 03 April 2020 07:28
Half of America’s small businesses can’t afford to pay employees for a full month under the current economic lockdown meant to slow the spread of the COVID-19 pandemic. This is according to new surveys released by SHRM (Society for Human Resource Management). The research found most businesses expect to see a decrease in revenue, while businesses in certain sectors can expect even greater losses. Additionally, a majority (58 percent) of American workers will be unable to meet basic financial needs within a period of 30 days or less.
The surveys polled a sample of American workers, HR practitioners, and small business owners regarding the expected economic impact of the coronavirus on their organization.
- Over half of small businesses expect revenue losses of 10-30 percent, while one in five expect losing more than 30 percent, and 4 percent expect a total loss of revenue and the closure of their business;
- 1 in 5 small businesses can’t afford to pay employees for more than a week under quarantine;
- Over half of American workers say their job cannot be done remotely and one third of small businesses say none of their business processes can be done remotely.
- 6 in 10 American workers say they will be unable to meet basic financial needs (rent, groceries, bills, etc.) in 30 days or less;
- 1 in 5 American workers say they will be unable to meet basic financial needs in one week or less.
“There are tough times ahead for all. Headlines have highlighted the pandemic’s impact on Wall Street, but the bigger story might be the economic shockwaves hitting the businesses and workers on Main Street,” said Johnny C. Taylor, Jr., SHRM-SCP, CEO and president of SHRM. “This new data underscores this pandemic is, in many ways, more challenging than the 2008 financial crisis. This virus shows nothing tests a culture like a crisis. If a company’s principles are just words on an outdated webpage, this stress could crack that workforce. But if principles exist in a real culture, that’s where people come together and thrive through hardship.”
The research showed that nearly 80 percent of HR professionals had formal or informal business continuity plans in place as of early March. However, nearly a quarter of American workers report their organization hasn’t shared how management is reacting to COVID-19.