Issue Brief: Financial Literacy and Small Business Resilience
The Covid-19 pandemic is the most significant economic shock in modern history. Overnight, the country went from steady growth and full employment to a full stop. As lockdowns were implemented, businesses shuddered operations. Since March 2020, we have developed ways to cope with the virus, but even two years later, we continue to deal with supply chain disruptions, virus variants, and remarkably changed business landscape.
Arguably, one of the most valuable, but vulnerable, areas of the economy are small businesses. Small businesses generate 44% of economic activity and have been the most important source of job creation for decades, and collectively employ large numbers of people. While some businesses adapted, at least partially, to the early stages of the pandemic, many did not or could not, and even those that did have found a dramatically different playing field.
In this issue brief, we summarize findings from a survey by researchers at Florida Gulf Coast University. The survey was conducted in the spring of 2021, and was distributed to all Southwest Florida Chambers of Commerce and Economic Development Offices for redistribution to their members and partners. The survey opened on February 1st, 2021 and remained open until the end of March. We had 38 respondents that complete the whole survey.
Main findings from the survey include:
- While small business owners anticipated using government assistance programs, a large proportion felt doing so would be difficult.
- Business owners that took advantage of Economic Development Centers held more cash on hand entering the pandemic and were more likely not to see a drop in 2020 sales.
- Owners scoring above 90% on the knowledge test administered were likely to have more cash on hand and sell more on credit entering the pandemic.
Download the latest Issue Brief for more information.