69% of Small Businesses in Accommodation and Food Service Industries Are Having Trouble Hiring Workers

More than one-third of the nation's small businesses reported difficulty hiring paid employees in the past seven days, according to the Census Bureau's Small Business Pulse Survey, fielded August 16-22. This iteration of the survey is the first time the Census Bureau has asked about hiring problems. 

Nationally, 35 percent of small businesses say they had trouble hiring employees in the past seven days. The figure is as high as 69 percent for businesses in accommodation and food services. This explains why service was so slow the last time you had dinner in a restaurant. Small businesses in manufacturing and health care also reported above-average difficulties in hiring. 

Forty-three percent of small businesses reported domestic supplier delays in the past seven days. The figure peaks at 68 percent among small businesses in manufacturing followed by retail trade (65 percent), construction (63 percent), and accommodation and food service (61 percent).

Percent of small businesses with problem in past week

42.6% had domestic supplier delays

34.7% had difficulty hiring paid employees

24.5% had difficulties in delivery/shipping to customers

17.5% had foreign supplier delays

13.9% had production delays

Source: Census Bureau, Small Business Pulse Survey, August 16-22

It's Not Just You

Most Americans are feeling the frustrations of supply chain problems, according to a Gallup survey. In the past two months, 60 percent of the public reports being unable to buy a product because of shortages. Almost as many—57 percent—have experienced a significant delay in receiving a product they have ordered. 

Overall, 71 percent of the public reports experiencing one of these two problems, and 46 percent report having both problems. 

"From the toilet paper shortage at the beginning of the pandemic to a car shortage today, Americans have experienced firsthand what it means when production constraints or a shortfall of critical manufacturing components means retailers can't keep up with demand," reports Gallup. 

According to results of the Census Bureau's latest Small Business Pulse Survey, fielded in mid-July, 39 percent of all small businesses have experienced domestic supplier delays in the past seven days—a record high. Among small businesses in retail trade, the 60 percent majority has experienced domestic supplier delays in the past seven days.

Source: Gallup, Most U.S. Consumers Have Felt Supply Chain Problems

Small Business Pessimism Drops Below 50%

For the first time in nine months, the percentage of small businesses expecting the worst from the coronavirus pandemic has fallen below 50 percent, according to the Census Bureau's Small Business Pulse Survey. That's progress.

The weekly Small Business Pulse survey asks businesses how long they think it will take before their business operations return to normal. During the week of March 8-14, slightly fewer than half of the nation's small businesses (49.5 percent) said it would take more than six months for them to return to normal, or their operations would never return to normal, or their business had permanently closed. This measure of pessimism has exceeded 50 percent since the week of June 7-13. The drop below 50 percent, although tiny, suggests economic conditions may be changing for the better.

How much time until your business operations return to normal? (March 8-14)

  0.8% say one month or less

  4.5% say two to three months

16.6% say four to six months

40.1% say more than six months

  7.3% say they do not think their business will ever return to normal

  2.1% say their business has permanently closed

16.9% say their business has not been affected by the pandemic

11.7% say their business has returned to its normal level of operations

Before we start singing happy days are here again, it's worth noting that the plurality of businesses still think it will be more than six months before their operations return to normal. Also, the great majority of small businesses in accommodation and food services (69 percent), arts and entertainment (66 percent), and educational services (69 percent) remain pessimistic.

Source: Census Bureau, Small Business Pulse Survey, March 8-14 

Small Business Pulse Survey Takes a Hiatus

Jobs are disappearing, unemployment claims are surging, the pandemic is raging. In the midst of this turmoil, the Census Bureau's Small Business Pulse Survey is going on hiatus. Following the release of data collected during the week of January 4 through January 10, the survey is taking a pause. Check back in February for information about future releases of the survey, the Census Bureau says. 

The Small Business Pulse Survey has been measuring the impact of the coronavirus pandemic on the nation's small businesses. The bureau fielded the first survey in late April (April 26 through May 2) and continued collecting data weekly through June. The pandemic was supposed to be over by then. It wasn't. Phase 2 of the Small Business Pulse Survey began in early August and ended in mid-October. The pandemic still wasn't over. Phase 3 of the Small Business Pulse Survey began in mid-November and ended on January 10. "The data collection period for the Small Business Pulse Survey is now closed," reports the  Census Bureau on the survey's web page. 

Here are some of the findings from the last week of the survey, January 4-10...

• 75 percent of small businesses say the coronavirus pandemic has had a moderate to large negative effect on them, including 90 percent of businesses in accommodation and food service.
• 40 percent of small businesses say their revenues have fallen in the past week, including 56 percent of those in accommodation and food service.
• 12 percent of small businesses say they have reduced their paid employees in the past week, including 27 percent of those in accommodation and food service.
• 55 percent of small businesses say their business operations will not return to normal for more than six months, will never return to normal, or the business has permanently closed. Among businesses in accommodation and food service, 77 percent report this level of pessimism. 

Source: Census Bureau, Small Business Pulse Survey

Slumping Revenues for Restaurants

The nation's small businesses are feeling the effects of the surge in coronavirus coupled with the onset of winter weather. More than one-third of all small businesses (38 percent) report a decline in operating revenues/sales/receipts in the past 7 days, according to the Small Business Pulse Survey fielded in the last week of November. Hurt the worst are small businesses in the accommodation and food service sector—such as restaurants. As of November 23-29, nearly two out of three (63.6 percent) reported a decline in revenue in the past 7 days.

It has been worse. Back in late April/early May, an even larger 74.6 percent of small businesses in the accommodation and food service sector reported lower revenues in the past 7 days. At the time, many states had ordered mandatory business closures as the first wave of coronavirus hit. Then things got better. Not only did the weather improve, but restaurants learned to adapt by shifting to takeout and offering outdoor dining. The percentage reporting a recent revenue decline fell to a low of 39.7 percent by the end of September. 

Since then, however, a growing share of restaurants and other businesses in the accommodation and food service sector are struggling. The percentage with falling revenues is surging as cold weather and renewed fears of widespread contagion drive customers away. The 63.9 percent reporting a recent revenue decline during the week of November 23-29 is approaching the spring peak. 

Percent of small businesses in the accommodation and food service sector reporting a decline in operating revenue/sales/receipts in the past 7 days, for selected weeks

63.6 percent: November 23-29 (3rd highest)

61.9 percent: November 16-22

50.5 percent: November 9-15

39.7 percent: September 27-October 3 (low point)

69.5 percent: May 3-9 (2nd highest)

74.6 percent: April 26-May 2 (peak)

Source: Census Bureau, Small Business Pulse Survey