Survey Shows Rising Costs, Staffing Shortage Identified As Top Threats To Small Businesses

The Small Business Association of Michigan has released the results of a survey it’s conducted to find what challenges concern business owners around the state the most. It has found staffing problems persist while costs have been going up. You can read more details below:

A new survey done last week by the Small Business Association of Michigan showed that while wages and staffing levels have begun to increase, rising costs and finding enough staff are still the top threats businesses are facing.

“The pandemic has been difficult for small businesses, but it’s clear that entrepreneurs are adapting and taking action to position their businesses for success,” said SBAM President Brian Calley.

The survey was conducted the week after President Biden announced a federal vaccine mandate and revealed the policy to be significantly underwater with 58% of small business owners opposed and 29% in favor. Thirteen percent expressed no opinion.

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“It’s not surprising that most business owners oppose the vaccine mandate, especially given the worker shortage,” said Calley. “This federal overreach threatens to make a difficult staffing situation even worse.”

The survey, conducted September 10-17, of more than 680 Michigan small businesses, also revealed that:

  • 77% of businesses reported that COVID-19 had a negative impact on their business in 2020, and 67 percent of businesses are still feeling the effects.
  • 79 percent of businesses reported higher cost increases than before the pandemic.
  • 64% of those surveyed said it’s significantly harder to keep their business fully staffed.
  • 19% of businesses have increased their workforce size since Jan. 2020, even in the face of workforce shortages and lost revenues. 47% of small businesses expect to grow employment levels over the next year.
  • 62% of businesses increased wages since the start of 2020 to attract and maintain employees.
  • 24% of businesses reported increasing employee compensation by more than 10 percent since Jan. 2020.
  • 55% of businesses reported reduced revenues in 2020 compared to 2019. 29% of those small businesses experienced a decline of more than 25%.
  • 83% of those surveyed expect revenues to stabilize or increase in 2021.
  • 16% of small businesses are pessimistic about the long-term survival of their business.