COVID-19 economic impact study indicates ‘greater sense of resilience’ among Wisconsin businesses

UW Oshkosh, WEDC and New North announce second statewide survey results

Published Wednesday, May 20, 2020

Many Wisconsin businesses responding to a second University of Wisconsin Oshkosh statewide survey anticipate the impact of the COVID-19 pandemic to continue through 2020 and beyond.

Twenty-three percent of responding businesses reported not being able to remain open beyond three months if current conditions persist, said Jeffrey Sachse, director of UWO’s Center for Customized Research and Services (CCRS).

But the 32 percent of respondents reporting they would likely survive beyond 10 months under current conditions points to a “greater sense of resilience,” he said.

“The cumulative impact of the survey results in April and May tell the story of businesses first responding to the emergency of the immediate impacts and now reassessing their new, long-term reality,” Sachse said.

UWO is partnering on the survey project with the Wisconsin Economic Development Corporation as well as New North and eight other Regional Leadership Council organizations to assess COVID-19 recovery ability and state and federal aid efforts. Additional collaborators include the Wisconsin Technology Council and the Wisconsin Workforce Development Association.

Respondents to the second survey, administered between May 4 and 17, represent more than 67,000 employees across the state. The first survey ran April 1-10.

Key findings of the May survey include:

  • Respondents reported April losses of 9,816 employees due to layoffs and furloughs in addition to the 8,795 reported for March.
  • Businesses also reported losses of $28.8 million in inventory (62 percent decrease from April), $78.9 million in income (7.2 percent decrease from April), and losses in wages and productivity totaling $26 million (56 percent increase from April).
  • Businesses reported other financial impacts of $118.6 million (62 percent decrease from April).

It is important to note that all losses are considered cumulative.

“It is encouraging to see reductions in inventory and income losses, though respondents are less optimistic about their ability to recoup these losses. It will be equally critical to trace the survivability of vulnerable firms now that we have started to reopen the state’s economy,” Sachse said.

Sixty-five percent of businesses reported being open at the time of the May survey, with 74 percent expressing confidence that they will be able to reopen soon.

“Based on the results of this survey, 77 percent of retail trade businesses and 90 percent of manufacturers believe they will be prepared to fully reopen in May,” says Barb LaMue, executive director of New North. “The sooner businesses feel they can be fully reopen safely and provide confidence to employees and customers, the more quickly we will be on the road to recovery.”

Survey results specific to the New North region can be found here.

This month’s survey additionally asked two questions of interest to the Wisconsin Bankers Association and Wisconsin Technology Council.

Seventy-five percent of respondents reported seeking some form of financial assistance in the past month (Paycheck Protection Program and Economic Injury Disaster Loan, etc.). Only 61 percent of respondents reported receiving assistance, Sachse said.

Respondents reported access to capital and customers remain their most pressing needs. The most pressing information technology workforce needs reported both before and during the crisis are in IT support (18.3 percent) and network operations (9.6 percent).

Sachse said 1,151 businesses responded to both the April and May surveys, representing a retention rate of 47.1 percent period over period. An additional 235 new businesses responded to the May survey. Data is reported with an error rate of plus or minus 3 percent based on a respondent pool of 452,000 active Wisconsin businesses.

CCRS also released statewide results by industry sector available online here.

 

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