The NFIB Small Business Optimism Index fell 8.1 points in March to 96.4, the largest monthly decline in the survey’s history. Nine of the 10 index components declined, which is evidence that economic disruptions are escalating on Main Street as small businesses struggle to keep their doors open. The small business sector is anticipating and bracing for continued economic disruptions.
“Our small business optimism index unfortunately confirms the tremendous negative impact COVID-19 has had on small business owners and their employees,” said NFIB’s Iowa state director, Matt Everson. “It also confirms the urgency of processing and distributing the forgivable loans, as promised by Congress and the SBA, as quickly as possible to put much needed funds into the hands of small businesses across Iowa.”
Some takeaways from the March survey:
- The NFIB Uncertainty Index rose 12 points in March to 92, the highest level since March 2017.
- Reports of better business conditions in the next six months declined 17 points to a net 5%, which is the largest monthly decline since November 2012.
- Real sales expectations in the next six months declined 31 points to a net negative 12%, the largest monthly decline in the survey’s history.
In Fort Dodge, Ryan Smith is trying to stay positive. He owns two small businesses, Kingsgate Insurance, which specializes in insurance small businesses, and Iowa Fire Control, which provides sales, service and installation of fire protection equipment and kitchen exhaust cleaning.
Smith is worried that his employees will choose to file for unemployment rather than show up to work, according to an NFIB news release. He’s filed for the Paycheck Protection Program for both businesses and is waiting to see if he’ll receive the financial assistance he needs to stay open.
His other business, Iowa Fire Control, has had about $100,000 in work postponed, or about 5% of total revenue. About 50% of Iowa Fire’s revenue comes from the hospitality industry, which is unfortunate considering bars and restaurants are shut down to everything except takeout.
To keep morale up, Smith has transformed Kingsgate’s Friday happy hour into a virtual affair. Instead of sharing stories in the kitchen area, his employees are sharing a beer over videoconference. To support local small businesses, Smith started ordering dinner from local restaurants and has the meals delivered to his employees’ homes.
“It’s been a much needed morale booster for my staff, and we’re going to keep the tradition going,” he said.