Business in the Northwest 2020

Key Finding 1: Pacific Northwest businesses are not immune to the impact of COVID-19

It comes as no surprise that PNW businesses have felt the negative impacts of the pandemic. More than two-thirds (64%) of business leaders report feeling a negative impact on their business, resulting in one-third of businesses having to close their doors. More than 1 in 10 (12%) businesses had to close permanently, while almost one-quarter (24%) have closed temporarily.

More than half of businesses in the region have experienced declines in revenue (52%), sales volume (52%) and profitability (53%). Non-essential businesses in industries such as retail and hospitality have been hit particularly hard, with 84% reporting that COVID-19 has had a negative impact on their business.

Expectedly, the pandemic has caused a sense of heightened anxiety, with business leaders reporting more concern for the future than in 2019. More than half (52%) are not sure what the future holds for their company, a 9-point increase from 2019. Additionally, just 68% of business leaders think the business climate in the PNW is changing positively, compared to 82% in 2019.

Key Finding 2: Pacific Northwest businesses shine by being adaptable and nimble during this trying time

Despite the pandemic’s detrimental impact on the economy, business leaders report feeling confident they possess the necessary skills and resources to navigate the current crisis. Business leaders are especially confident in their ability to make tough decisions in the midst of chaos, with 65% reporting they can maintain emotional control and objectivity while keeping focused on the situation at hand.

Many businesses leaders had to make difficult and timely decisions to stay afloat, and thanks to their quick decision making, many feel they have been able to mitigate the impact of COVID-19 on their business. When asked what responses had the most positive impact on their business, leaders pointed to several shifts:

• Delivery services: 9 in 10 business leaders say updating their delivery options (87%) and increasing (88%) or decreasing (55%) the speed of their deliveries has helped them stay in business.
• Online retail options: A little more than 8 in 10 (85%) say that updating their retail options, particularly setting up online retail (89%) or increasing online retail efforts (89%), has helped.
• Products & service offerings: Refining or re-strategizing product and service offerings has helped 76% of business during this time. Specifically, expanding their products or services (86%), introducing new products or services (86%) or even reducing products or services (59%).

Key Finding 3: Essential businesses fared better during COVID-19

While many businesses have faced significant challenges during the pandemic, nearly one-fifth (19%) of business leaders, from varying industries and company sizes, report that the pandemic has had a positive impact on their business. Among the positive business impacts, 29% say it has improved their company operations and 28% have seen an increase in sales volume.

Additionally, several business leaders have reported encouraging impacts on their personal life, such as having more time to do things they enjoy (70%), feeling motivated to pursue personal passions (69%) and spending more time with family (69%).

Due to the nature of their operations, essential business leaders have experienced significantly more positive impacts than their non-essential counterparts, with 23% reporting the pandemic has had a positive impact on their business, compared to only 6% of non-essential business leaders.

Essential business leaders also feel more confident about the region’s future business climate, with 83% feeling optimistic about the next three years, compared to 71% of non-essential business leaders.

However, business leaders across industries are confident they and their businesses can weather the storm, with 88% feeling confident in their personal ability to keep their company successful despite the challenges presented by the pandemic.

Key Finding 4: Business Leaders support the pandemic response from state and local governments, but lack trust in the federal government

Business leaders report feeling that state governments are taking appropriate measures to slow the spread of COVID-19. Two-thirds (66%) feel their state governments have done an excellent or good job responding to the COVID-19 crisis. In comparison, less than half (49%) believe the federal government has done a good job. 8 in 10 (79%) say stay-at-home orders were the correct response to COVID-19, noting that they were essential to public health and a crucial step in stopping the spread of the virus.

However, small business leaders (less than 50 employees) are more likely to be dissatisfied (26%) with their state government’s response to COVID-19. This is likely due to the impact stay-at-home orders had on their business operations, as 28% of small businesses are more likely to have only storefront operations and rely on in-store and in-person interactions.

Yet, despite setbacks caused by stay-at-home orders, business leaders across the PNW are optimistic about the business climate over the next three years, with Idahoans feeling particularly optimistic (94%), compared to those in Oregon (81%) and Washington (76%).

Key Finding 5: Business leaders step up to support their communities and employees

Business leaders across the PNW recognize their influence and have embraced leadership roles within their communities, with 87% feeling a larger responsibility towards their community and 84% reporting they feel they are receiving more community support in return.

Amid the pandemic, 95% of business leaders feel an increased sense of responsibility to support their employees and have made significant changes to make life easier for their employees during this time.

More than two-thirds (71%) of business leaders have made changes related to their employees’ work hours by allowing flexible work hours, setting core work hours or capping the number of hours employees work. In fact, business leaders plan on keeping most of the changes they have implemented to adapt to the “new normal.” To meet the needs of employees, business leaders plan on continuing to provide new work equipment (84%), additional training (81%), mental health resources (77%), additional parental resources (79%), well-being seminars (78%) and flexible work hours (67%).

Although business leaders have made difficult decisions for their businesses, many continue to put their employees first. One-third (35%) of business leaders have taken firm stances against layoffs – not even considering downsizing or laying off any of their workforce.

Key Finding 6: Teleworking will be the future for many Pacific Northwest businesses

Teleworking is one of the biggest changes that Americans have adjusted to during the COVID-19 pandemic. Business leaders have reaped the benefits of teleworking, reporting that positive impacts are driven by more independence, as well as flexible work hours.

However, there are some drawbacks. Business leaders report their employees have experienced an increase in stress (30%) and lack of productivity (23%) due to teleworking. These negative impacts of teleworking are driven by stress induced by the pandemic (44%), lack of in-person communication (38%), and at home distractions (33%).

Working virtually will continue for many when the pandemic is over. More than half of business leaders (56%) will continue allowing employees to work from home. Nearly three-quarters (74%) will continue with virtual meetings. Washington state business leaders are especially keen on teleworking, with 67% saying they will continue post-COVID-19 compared to 43% of those in Oregon, and 40% of those in Idaho.

Key Finding 7: Business leaders feel prepared for the future

Despite the challenges of COVID-19, more than three-quarters of business leaders (80%) are optimistic about the business climate in the region. Additionally, 92% feel their company is equipped with the tools they need to withstand changes over the next three years.

Business leaders point to their company’s technology (38%), ability to innovate (38%), company reputation (37%) and competitive spirit (37%) as the top reasons they believe they can withstand change.

Small and medium business leaders are more hopeful about what the future has to offer: 83% are optimistic about the business climate over the next three years, compared to 68% of those who work for larger businesses.

Additionally, small and medium business leaders are more confident their company will meet their growth goals for the next year (74%), compared to just 50% of those from larger companies. This heightened sense of optimism may be because small and medium business leaders are less likely to report negative business impacts from COVID-19 (61%) compared to those who work for larger businesses (80%).