NFIB's Latest Covid-19 Survey: Supply Chain Disruptions, Staffing Shortage, And The Holiday Season
Supply chain disruptions and staffing shortages will raise costs and prices at small businesses this holiday season, according to the newest NFIB Covid-19 survey. The survey data was collected in late October and marks the organization’s 20th such report, dating back to March 2020.
“Going into the busy holiday season, nearly half of small business owners who rely on holiday sales as a significant part of yearly revenue report that both the supply chain disruptions and the staffing shortage will impact their holiday sales,” said Holly Wade, executive director of NFIB’s Research Center. “Small employers continue to adjust their business operations and hiring practices to compensate for these issues, including for many dramatic price increases.”
Some key findings in the report:
Supply Chain Disruptions
- About half of small business owners (48%) reported that supply chain disruptions are having a significant impact on their business, almost unchanged from September’s survey.
- Supply chain disruptions are becoming increasingly challenging for many small business owners, with over half (62%) experiencing disruptions saying that the supply chain disruption is worse now than it was three months ago.
- Almost all small business owners (90%) anticipate the supply chain disruption that is impacting their business to continue for five or more months.
- Twenty-six percent of small employers are currently experiencing a significant staffing shortage and another 22% are currently experiencing a moderate staffing shortage.
- Of those small businesses currently experiencing a staffing shortage, 23% are experiencing a significant loss of sales opportunities and 28% reported a moderate loss of sales opportunities because of the staffing shortage.
- Small employers are adjusting hiring practices to attract employees for their open positions. Seventy-nine percent reported increasing wages, 21% increased paid time off, 16% offered or enhanced hiring bonuses, 19% offered or enhanced referral bonuses, and 23% offered or enhanced health insurance benefits.
- In addition, owners are making business operation adjustments to compensate for the staffing shortage. Forty-two percent of owners are offering more hours to part-time employees, 67% are offering overtime to full-time employees, almost all (91%) of small employers responded that the owner(s) are working more hours, and 39% have adjusted business operation hours.
Pricing and Compensation
- Sixty-nine percent of small business owners have increased their average selling prices due to supply chain disruptions and/or increased compensation due to the staffing shortage.
- Of those who increase selling prices, 66% raised prices by 5% or more.
- Of small business owners who rely on holiday sales for a significant part of yearly revenue, about half (49%) of them believe both supply chain and staffing issues will impact holiday sales. Seven percent anticipate only staffing shortages will impact holiday sales and 38% just supply chain disruptions.
- Twenty-six percent of owners anticipate these issues will have a significant negative impact on their business, about half (42%) reported a moderate negative impact, and 25% reported a mild impact.
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