Nevada State Bank has released the results of its eighth annual survey of small business owners and managers throughout Nevada. The survey reflects the hardship caused by COVID-19 and related responses, but also the hopeful perspective on economic recovery during the next 18 months.
“Even with the economy on top of the list of concerns, we see that Nevada businesses expect to return to pre-COVID levels in an average of 1.8 years, whereas they expect the U.S. economy to take an average of three years—I see optimism about our state’s recovery there.”
“It has been quite a year since our last survey, and we were encouraged to see some optimism balancing the impact of the global pandemic on the state’s small businesses,” said Terry Shirey, president and CEO of Nevada State Bank. “Even with the economy on top of the list of concerns, we see that Nevada businesses expect to return to pre-COVID levels in an average of 1.8 years, whereas they expect the U.S. economy to take an average of three years—I see optimism about our state’s recovery there.”
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The bank’s annual survey, conducted by Applied Analysis, asked questions about the economy, business environment, revenue and profitability, employment, community involvement, and the overall outlook for small businesses in Nevada. Highlights of this year’s survey include:
- For the first time in eight years, the economy was the No. 1 concern for small business owners. Government regulation came in second, with healthcare costs and business taxes tied for third.
- Nearly 1 in 3 small businesses (32.5%) reported that they believe the national economy is heading in the right direction, a drop of 44.5 percentage points from the prior year’s survey.
- Only about 1 in 4 respondents indicate they believe Nevada’s business environment has gotten better or stayed the same over the past year, reversing historical perceptions.
- Nearly half of respondents believe Nevada’s business environment will get better in the upcoming year, and about 3 in 4 respondents indicated they plan to have about the same number of workers working remotely as they do today.
- Nearly 3 in 4 small business respondents (70.8%) applied for a Paycheck Protection Program (PPP) loan, a relief program brought about by the CARES Act. Of those who applied, nearly all were successful in obtaining a PPP loan, which a majority (94.4%) said helped their business to be able to retain their employees in 2020. As a result of its success, over 2 in 5 small business respondents (43%) plan to or have applied for the new round of PPP loans in 2021.
- Nearly one-third of small business respondents (29%) are very concerned about housing affordability, with another 30.8% citing moderate concern. The affordability of workforce housing could worsen in 2021, as 50% of respondents also believe interest rates will rise this year.
- For the sixth year, survey respondents cited difficulty recruiting quality job candidates as a major concern. Nearly 3 in 4 small business respondents (73.8%) noted that it was “somewhat to very difficult” to recruit quality job candidates in Nevada from within the market. Nearly 2 in 5 respondents (39%) noted that it was “very difficult” to recruit quality job candidates.
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The statewide survey by local firm Applied Analysis was conducted during January on behalf of Nevada State Bank. To ensure it is statistically significant, the bank surveyed more than 400 randomly selected small business decision makers, including owners, operators, and executives representing Nevada businesses with annual sales ranging from $250,000 to $10 million.
“Small businesses in Nevada have been the most accurate at telling us where the economy is going to go, and if I’m going to use one word to describe how small businesses are feeling this year, it’s pensive,” said Jeremy Aguero, principal analyst with Applied Analysis. “They recognize the difficulties of 2020 and are looking to the future. Concerns about government regulations and finding and hiring talent persist, and where the economy goes post-COVID-19 is a cloud looming over it all. They do expect a recovery, but questions on the ability to get there jump out at me more than anything else in the survey.”
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