New research from Paychex Inc. has found that three of the biggest obstacles businesses face are financial instability, bringing employees back to the office and developing a COVID-19 vaccine policy.
The survey showed that small- and mid-size business owners continue to be in a dangerous position financially in the wake of COVID-19. Some 61 percent of Paycheck Protection Program (PPP) loan recipients in the survey characterize the 2021 PPP loan as important to their business’s survival. Overall, more than half of companies with 50 to 500 employees characterize the funds as critical to their business survival this year, up 14 percent from 42 percent reporting that sentiment last year.
Two in five respondents will apply for the second PPP round, on par with application rates in 2020 and the likelihood to apply increases with company size, as it did in 2020, the survey found.
Just two in five respondents said they were aware of the Employee Retention Tax Credit (ERTC), which, according to the Consolidated Appropriation Act 2021, can now be taken in combination with a PPP loan. Only one in five business owners plans to claim the ERTC. Awareness and planned usage increase with company size as half of the mid-sized businesses will claim the ERTC.
To help maintain customer loyalty, many businesses are carefully coordinating a plan for employees’ safe return. Some 55 percent of small- and mid-size companies surveyed remain at least partly remote, while 12 percent say that some or all of their workforce will permanently work at least part of the time remotely following the pandemic. More than 40 percent of small- and mid-size businesses are still working out the details of bringing employees back to the workplace.
Vaccination will play a critical role in getting staffers back to work. Many business leaders see themselves having a role in employee vaccination. Three-quarters of small business owners (10-49 employees) and 85 percent of mid-sized businesses (50-500 employees) plan to motivate their employees to get the COVID-19 vaccine. Some 25 percent of all survey respondents expressed concerns around potential legal liabilities if they were to incentivize employee vaccination.
The business impact of a slow vaccine rollout is the greatest concern among small- and mid-size businesses, followed by lack of vaccine efficacy. Beyond that, business leaders are most concerned about customer notification, employer guidelines and employee vaccination refusal.
More than half of respondents say their employees want the COVID-19 vaccine, with a slight increase with company size. Roughly one in five employees have either expressed reluctance or not commented.
“From the financial toll COVID-19 has taken on businesses, to the confusion around returning employees to the office, and what to consider when building a vaccination policy, business owners are facing a level of complexity never seen before,” said Mike Trabold, Paychex director of compliance risk. “That’s why we’ve created educational resources addressing a spectrum of new challenges. Whether it’s a full shutdown, seeking funds to keep doors open, struggling to manage a remote workforce, or hiring to meet new and unexpected demands, we’ll continue to guide business owners through the difficulties identified in this research.”
These insights are based on the company’s latest survey of business owners, conducted Jan. 27 through Feb. 2, 2021, which polled 300 principals of U.S. companies with two to 500 employees.
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