While company executives are increasingly optimistic about the future of their organizations, many say their businesses will suffer if the government does not come up with more initiatives to stimulate the economy.
More than half of executives — 54% — said there will be a negative impact on their companies if Congress does not pass another economic impact package to counter the effects of the pandemic, according to a survey by trade group the Association of International Certified Professional Accountants (AICPA).
With companies trying to maintain their businesses amid the continued coronavirus outbreak, some executives are looking to the government for decisive action.
Time is of the essence
Back in March, Congress passed the Coronavirus Aid, Relief, and Economic Security (CARES) Act and President Trump signed it into law. The legislation included economic assistance for businesses, as well as workers and families. However, Congress has remained locked in negotiations for months about a second round of relief, with many key stimulus programs set to expire by the end of the year.
According to business executives surveyed by AICPA, their companies will suffer if they don’t receive additional assistance in a timely manner. When asked when they would need the assistance:
- 26% said in the next 3 to 6 months
- 23% said in the next month or two
- 6% said within 12 months
For 3% of businesses, it is already too late.
Executives also had some ideas about what government steps would be most helpful for their businesses. More than 8 in 10 executives — 83% — said the most helpful step the government could take was to make further progress in controlling the COVID-19 pandemic. That was followed by:
- Keeping burdensome regulations to a minimum (52%)
- Ensuring the corporate tax rate remains low (35%)
- Creating fiscal stimulus aimed at helping individuals and families (32%)
- Increasing business relief programs (28%)
Business executives see a glimmer of hope ahead
Though some businesses were pessimistic about their ability to survive the COVID-19 crisis in the early days of the pandemic, the outlook for many is better now.
Nearly 1 in 2 executives — 49% — said they are optimistic about their organization's prospects moving forward. Some of the factors that are causing this positive outlook include a possible second stimulus package, the rebound of the stock market and positive news about vaccine development. However, executives still have some concerns, such as the impact of a winter wave of COVID-19 and the possibility of new shutdowns.
Another hopeful sign is that companies may be easing future layoff plans. In the fourth quarter of this year, only 11% of companies said they had too many employees, down from 16% last quarter. On top of that, 51% of companies said they have an appropriate number of employees.
In good news for those seeking a job, 34% of respondents said their companies did not have enough employees. Also, 17% said they are planning to hire employees in the near future, up from 7% in the second quarter and 13% in the third quarter.
An earlier survey found that more than half of businesses expected to refill pandemic vacancies within six months.
Methodology: AICPA surveyed 740 of their Business & Industry members between Nov. 10 and Dec. 2, 2020. Among the respondents, 42% were chief financial officers; 20% were controllers; 15% were presidents, chief executive officers or other C-Suite members; 7% were vice presidents or senior vice presidents; and 14% were accounting, audit, tax, technology directors or managers. The remainder were executives in other positions.