Please ensure Javascript is enabled for purposes of website accessibility

Small Businesses Hit Hard by Coronavirus Crisis, Survey Finds

By Dave Kovaleski - Mar 24, 2020 at 11:22AM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Goldman Sachs expects a record GDP drop in the second quarter.

America's small businesses are struggling to stay afloat during this coronavirus (COVID-19) pandemic, according to a recent survey by Goldman Sachs (GS 0.48%).

The survey of more than 1,500 members of Goldman Sachs' 10,000 Small Businesses program revealed that 51% of small-business owners said they could not weather more than three months of the current economic environment. Further, 96% said they have already been affected by COVID-19 and 75% have seen reduced sales.

A man and a women look over documents in their small business

Image Source: Getty Images

Among other findings, 53% said their employees don't have the opportunity to telecommute; just 13% are confident in their contingency plan to meet their business needs; 67% don't know how to access or apply for emergency funding; and 75% feel they have little or no voice in the policies that impact them.

The survey asked respondents what government support measures would help them the most. Roughly 83% said grants, while 77% called for payroll tax cuts. Further, 75% said reimbursement for paid sick leave, 74% said delayed of tax payments, 73% said delay of mortgage payments without penalty, while 70% said loans with lower interest rates. Finally, 70% seeks a government-backed quick loans and 62% call for enhanced employment insurance.

At present, approximately 16 states have issued stay-at-home mandates to their residents, affecting about 40% of the population. Most of these states have closed nonessential businesses. Due to the lockdowns and social distancing measures, Goldman Sachs Research forecasts a 6% drop in U.S. GDP this quarter and a whopping 24% drop in the second quarter -- which would be the worst since the Second World War.

For the year, Goldman Sachs Research sees a 3.8% contraction in U.S. GDP and a 1% decline in global GDP.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

The Goldman Sachs Group, Inc. Stock Quote
The Goldman Sachs Group, Inc.
GS
$308.20 (0.48%) $1.47

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
327%
 
S&P 500 Returns
116%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 05/20/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.