Nearly a year since the coronavirus pandemic forced businesses to scale back operations, business owners are still struggling to recover. About 53% of small business owners don't expect to return to pre-Covid operations for at least the next six months, according to data from the Small Business Pulse Survey conducted by the U.S. Census Bureau in December 2020.
Just over a quarter of small businesses in metro areas around the country are currently operating at normal levels, the survey shows.
Personal finance website SmartAsset examined data from the survey to rank the largest 50 metro areas throughout the U.S. in order to determine which areas have the most positive outlook for 2021. There was fairly low positive business sentiment overall, but North Carolina fared the best. The results showed a promising outlook for the state, with three of the top 10 metro areas where small business sentiment is relatively strong at least partially located in North Carolina.
In the Raleigh-Cary metro area, 37.5% of small businesses are operating at normal levels. About a quarter of respondents also indicated that they will be looking to hire new employees this year.
Plus, nearly half of small business owners in Raleigh-Cary expect to recover financially in the next six months.
Despite only 2% of small businesses in the U.S. closing in 2020 due to Covid-19, many saw a downturn in profits last year due to a decline in consumer spending, SmartAsset reports.
On average across the 50 largest U.S. metro areas, only 26% of small businesses have at least three months of cash readily available, which is the minimum amount generally recommended as a safety net.
This left many small businesses having to dip into their savings to compensate for losses in income.
The average small business sets aside enough money for 27 cash buffer days, data from J.P. Morgan Chase shows. But as of the first week of December, 25% of small businesses held fewer than 13 cash buffer days in reserve.
That's likely due, in part, to the Covid-19 pandemic, which has highlighted the importance of a having a financial safety net for businesses to rely on when the unexpected occurs.