31% of Small Businesses Have Reintroduced Pandemic-Era Restrictions Amid Delta Surge

31% of Small Businesses Have Reintroduced Pandemic-Era Restrictions Amid Delta Surge

Small business leaders also consider mandating proof of vaccination for customers
woman showing vaccination passport on phone

With the recent spike in COVID-19 delta variant cases, consumers and businesses alike have once again adopted more stringent measures to protect themselves against the pandemic.

In fact, small business lending platform Kabbage found in its latest Small Business Recovery Report that 63% of small businesses today are fully open without any COVID-19 restrictions — down from 85% in May of this year. Notably, 31% of small businesses that were fully open previously have now reinstated pandemic-era restrictions at their companies.

Proof of vaccination guidelines vary by business size

Kabbage's August report indicated that 35% of small business leader respondents would require proof of vaccination from customers before they could remove their masks on-site.

The September report found that plans on actually implementing such a policy varied by business size:

  • 18% of small business leaders are "100% certain" they’ll require customers to show proof of vaccination
  • 28% of small business leaders said implementation of this policy was likely
  • 55% of respondents at the largest small businesses are either "100% certain" or "very likely" to require proof of vaccination
  • 61% of respondents at the smallest small businesses "will not require it at all" or "don't know" if they will

A similar survey conducted by Willis Towers Watson revealed that, by the end of this year, 29% of employers plan to make vaccination a requirement for their workers to enter the workplace, as 21% plan to make it a condition of employment.

Small businesses struggle to hire amid national labor crisis

The Kabbage survey also assessed how small businesses are coping with the national labor shortage, and found that nearly a third of small business leaders (32%) say it's "very" or "somewhat" difficult to find new hires — an increase from the 28% who said so in the last report.

Respondents say that the biggest reasons for this challenge include:

  • Candidates who are not qualified (32%)
  • Candidates with child care or family caregiving responsibilities at home (32%)
  • Candidates who don't feel safe returning to work (29%)

The labor crisis is affecting those already employed at these businesses, as 40% of small business leaders now report that their employees are taking on longer shifts to make up for the additional work. Business leaders are compensating these workers for their efforts, however — 32% of respondents say they are reallocating their unused new-hire budgets into "increasing salary for existing staff."

Methodology: Kabbage conducted an online survey between July 27 and Aug. 17, 2021 of 550 small business leaders. This group included 250 at the smallest companies (20 or fewer employees), 200 at medium-sized small businesses (21 to 100 employees) and 100 at the biggest small businesses (101 to 500 employees).

Survey participants worked in industries such as agriculture, automotive, construction, education, financial services, food and beverage, health care, manufacturing, marketing, media, professional services, retail, technology and more.