Survey: Anxiety, uncertainty cloud business outlook
BENNINGTON — Thirty-five percent of Bennington County businesses say they don't expect to return to "normal" operations until 2021 or later, while more than a quarter say they can't predict when that might happen, according to survey results released Wednesday by the Southwestern Vermont Chamber of Commerce.
The challenges of dealing with the COVID-19 pandemic dominated the responses to the annual State of the Commerce Survey, which was completed by 106 of 406 chamber members. Data was collected in July and tabulated by the chamber.
"No surprise on this year's survey, COVID-19 dominated the themes, feedback and trends of the report," Matt Harrington, executive director of the chamber, said in a statement. "Anxiety and uncertainty on the future of business and life in Southwestern Vermont are the most pressing issues for many of our small business owners and nonprofits according to this survey."
Nine percent of businesses responding said they hope to be operating normally by the third quarter of this year, 12 percent by the fourth quarter of 2020, 10 percent by the first half of 2021, 15 percent by the second half of 2021, and 10 percent by 2022. Five percent predicted they would never return to normal operations, and 12 percent said they are currently operating as usual.
"It's concerning that a majority of the participants don't even expect to be at normal operating status until late 2021," Harrington said. "Imagine a whole year from now before you're operating like it's 2019. This shows the hardship and difficult decisions many of our owners and operators are having to make."
"The whole story here is the pandemic," one respondent commented. "We are just not going to recover until it's over."
Among those responding, the survey found that 59 percent of businesses are operating at 75 percent of capacity or less, and that 10 percent have closed. Forty percent said they had reduced the number of employees to reduce the negative effects of the pandemic, while 28 percent had cut hours.
Thirty-one percent said they had changed their business model, while 20 percent indicated they had not taken any measures.
Sixty-two percent of respondents said much of their current economic relief came from economic relief funds such as the Economic Injury Disaster Loan and the Paycheck Protection Program. Twenty-two percent said they "did not need any additional financial assistance in the last twelve months," while 21 percent said they have tapped into IRAs, 401Ks and other personal savings to keep their businesses afloat during the pandemic.
At least one respondent reported difficulty in getting assistance. "Help! All the help that has been offered hasn't filtered down to us — EIDL was applied for three months ago and [we have] barely any idea where we stand," they wrote.
"It's heartbreaking to hear some of these stories where business owners have cashed in all their life savings just to keep their businesses running," Harrington said. "What's worse is that those funds just got them through the last six months. If owners and operators don't expect to get back to normal until late 2021, how are they going to continue to fund these businesses after using all of their personal savings?"
Nearly a quarter of businesses gave their financial health a letter grade of D or F, up from just 3 percent in last year's survey. Forty-three percent graded their financial health at A or B, down from 70 percent in 2019, while 35 percent responded with a grade of C.
"You can see how reality has shifted in a mere twelve months with the global pandemic and how that impacts the health of our organizations," Harrington said.
Asked to pick the top three factors affecting their business's success, the COVID pandemic was far and away the top choice, named by 85 percent of respondents. The area's general business climate came in second, at 36 percent, while thin margins, workforce issues like hiring and childcare, demographic challenges and "financial limitations" were clumped together at 15 to 19 percent.
The survey found that 23 percent of respondents had turned to online commerce for the first time.
Respondents continued to express optimism in southwestern Vermont. Eighty-seven percent said it was a good place to do business, up from 84 percent in 2019 and 81 percent in 2018, while 74 percent said they expect the business climate to get better in the next three years, down from 2019's result of 80 percent.
"I think the `is Southwestern Vermont a good place to do business' question and positive response is a mixture of resolve, grit and community support," Harrington said. "The resolve and grit of our business owners and non profits is really something remarkable.
"Additionally, I hope the positive answer on that question is a testimony to the work the state, local agencies, the chamber and this community have done to rally behind our small business owners. There is still a lot of work to be done, but attitude can be a game changer," he said.
"Even in the midst of a global economic and health crisis, Southern Vermonters still think that tomorrow will be better. It's why people love to come to Vermont. Vermonters know how to dig in and weather the storms. If the survey is any indication of the attitude of Vermonters, we will weather this storm too."
The purpose of the State of the Commerce Survey is to hear from regional businesses and nonprofits about how they are doing in the current economy, what their current attitudes are in relation to economic vitality, and what new small business trends they see emerging, according to the chamber.
The main industries represented in the survey based on who filled out the survey included retail at 25 percent, nonprofits at 17 percent, lodging at 14 percent, dining at 10 percent, and attractions at 8 percent. Additional sectors included education, health care, real estate, law, marketing, agriculture, energy, government and manufacturing.
Fifty-four percent of the businesses that responded are located in Bennington or North Bennington, and 34 percent are in Manchester. Twelve towns accounted for the remainder. Survey results were not broken down by location or business type.
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