Welcome to the Small Business Weekly Rundown. Each week, we bring you stories and trends that impact small business owners and their workforce.
Small Business News Highlights:
- Small business optimism hits 7-month low
- The Paycheck Protection Program (PPP) reopens for business
- Over 1 million PPP loans have been forgiven already, according to SBA
- Federal Reserve says jobs boom depends of accelerating vaccinations
Small business optimism hits 7-month low
“This month’s drop in small-business optimism is historically very large, and most of the decline was due to the outlook of sales and business conditions in 2021.”
The National Federation of Independent Businesses reported that small business owner optimism, as measured by the NFIB Optimism Index, bottomed out in December. SBO optimism sank in response to growing outbreaks of the coronavirus as well as potential changes in economic policy resulting from the presidential election.
In October, the Optimism Index hit 104, placing it nearly back at pre-pandemic levels.
The Paycheck Protection Program (PPP) reopens for business
“If your business is in the restaurant and accommodation industry then you can get a loan of up to 3.5 times your average monthly payroll instead of the normal 2.5 times.”
The PPP reopened its application process this week to small businesses seeking federal aid to weather the continuing economic hardships created by the pandemic.
While the program is still mostly the same, there are a few key differences, including the fact that more types of expenses can now be counted in the calculation determining loan forgiveness.
Over 1 million PPP loans have been forgiven already, according to SBA
“Today’s news is a key indicator that the PPP is working for all small businesses across our Nation.”
And speaking of forgiveness … the Small Business Administration announced that over 1.1 million PPP loans made last year have already been forgiven. The SBA reports that it has received 1,346,125 applications for forgiveness worth over $170 billion and have made a payment on nearly 85% of those applications. For small businesses borrowing up to $50,000, 88% of forgiveness applications have already been approved.
Federal Reserve says jobs boom depends of accelerating vaccinations
“The recovery is directly linked to the pace of vaccinations and its effectiveness both in terms of numbers, but also in terms of the confidence it instills in consumers.”
Federal Reserve officials have indicated that they believe that the speed of the COVID-19 vaccine rollout has a direct impact on job creation and economic recovery in the United States. Economists believe that even modest delays in inoculating people matter, with one expert estimating that a slow start has already cost developed nations more than half a percentage point of growth for the year.
The Latest from Workest
Curious what President-elect Biden’s campaign pledge to increase the minimum wage could mean for small businesses? Check out this list of FAQs by Cinnamon Janzer.
Stressed? If the answer is yes, you’re not alone. Find out why companies are adding mental health benefits for employees in this article by Kelsey Banerjee.
Finally, before we say goodbye for the week, here are 3 things you should know:
- Roughly 300 small business owners report receiving PPP loans worth $99 or less due to the way the aid bill was written.
- We don’t have a crystal ball to see into the future, but here are 5 predictions for small businesses under the Biden Administration.
- Under the latest COVID-19 relief bill, many people actually qualify for 15 weeks of unemployment, though the last 4 weeks don’t include the $300 federal supplement.