According to new research from Paychex, Inc., a leading provider of human resources, payroll, benefits, and insurance solutions for 670,000 small- and medium-sized businesses, 90 percent of business owners say the Paycheck Protection Program Flexibility Act’s provision extending the forgiveness period from eight to 24 weeks will be impactful to their business, and 82 percent say the same about the loan repayment term being extended from two to five years. Despite initial uncertainty around the terms of their PPP loans, most business owners now indicate the PPP Flexibility Act will be meaningful for their businesses as they work to resume operations and bring back employees.
“While many were relieved to receive PPP funds, our earlier research showed the initial guidelines presented a challenge to some business owners. The PPP Flexibility Act has eliminated some of the barriers to businesses getting the most out of their PPP loans during the reopening phase and beyond,” said Martin Mucci, Paychex president and CEO. “It’s reassuring to see our latest round of research indicate that business owners feel this important new legislation will be helpful to them. As businesses begin to reopen and PPP funds are being used, it’s our hope that the clarity offered within the Flexibility Act provisions will alleviate some of the immediate financial pressures so that business owners can focus more on getting their operations back on track for the long-term.”
As part of a five-part survey series, Paychex has regularly polled 300 randomly selected business owners with 2-500 employees since April. Conducted June 12-15, other insights from the Wave 5 survey included:
Status of active businesses:
- 49% are fully open and operational.
- 42% are open on a limited basis.
- 9% are closed but plan to reopen.
- Of the businesses that remain closed, 12% plan to open this month, 27% in July, and another 27% after July. Nineteen percent say they’ll open when business conditions improve and 15% will do so as soon as they’re permitted to.
PPP status and hiring:
- Of those who applied for PPP funding, 64% have received payment, 15% have been approved and are awaiting payment, and 10% submitted paperwork and are waiting for approval.
- Of those with an application approved or pending, 46% say it’s critical, and they’ll go out of business without it. Another 46% say it’s important, but they’d survive without it.
- Of those with an application approved or pending, 60% say the PPP will help them retain or rehire all employees, while another 28% say it will help them retain or rehire at least half of their pre-COVID-19 workforce.
PPP Flexibility Act:
- Most owners feel this new legislation will be very impactful for their businesses:
- 90% say the forgiveness period extending from 8 to 24 weeks will be impactful.
- 82% say the loan repayment term being extended from 2 to 5 years will be impactful.
- 80% say the payroll taxes being deferred will be impactful.
- 79% say the 60% being used for payroll will be impactful.
- 78% say the forgiveness being allowed even if the full workforce doesn’t return, in some cases, will be impactful.
Short-term business needs:
- Thirty-eight percent of business owners feel technology that helps them transition back to the workplace offers the most value to them in the short-term.
- Following in order, business advice and guidance (33%), access to a team of HR experts and resources (17%), and access to compliance experts (13%) are other services respondents feel are most valuable during this time.
Second wave concerns:
- The same percentage (84%) of business owners is concerned about a potential second wave of COVID-19 in Wave 5 as in Wave 4.
- Sixty-two percent say they could afford to close and reopen if a second wave occurs, while 38% could not.
For more data insights from this survey, visit this Paychex WORX article. Business owners can also access the Paychex Coronavirus (COVID-19) Help Center on paychex.com for more resources, including a Back to Business Guide, to help them manage the various impacts of COVID-19 on their business.