U.S. Small Businesses Suffer Supply Chain Disruptions

Which U.S. small businesses are being hardest hit by supply chain disruptions during the pandemic and has that changed since earlier this year?

The U.S. Census Bureau’s Small Business Pulse Survey (SBPS), designed to measure how COVID-19 is affecting small businesses, captures the extent of some of these business disruptions.

The survey shows that 38.8% of U.S. small business respondents reported domestic supplier delays in the most recent and final week (7/12-7/18) of the SBPS’s Phase 5. That’s up from the 30.9% portion during the last week (4/12 –4/18) of Phase 4.

The percentage of businesses by sector that reported domestic supplier disruptions the last week of phase 5:

• Manufacturing, 64.6%.
• Retail, 59.8%.
• Construction, 58.5%.
• Accommodation and Food Services, 51.4%.

The share of businesses that reported foreign supplier delays increased from 12.2% at the end of Phase 4 (ended in April) to 15.9% at the end of Phase 5. Wholesale small business respondents showed the highest impact at 41.7%.

In addition, 17.7% of respondents indicated they would need to identify new supply chain options in the next six months, compared with 14.0 % at the end of Phase 4.

A 39% slice of manufacturing small business respondents said they would need to identify new supply chain options within the next six months.

Delivery and shipping delays also increased: 22.7% of respondents indicated delivery and shipping delays at the end of phase 5 compared to 18.5% at the end of Phase 4.

The survey also measures how hard it was for small businesses to find alternative domestic suppliers: 18.9% reported difficulty at the end of Phase 5 and 13.0% at the end of Phase 4.

Finding alternative foreign suppliers was an issue for 7.2% of respondents at the end of Phase 5, compared with 4.7% at the end of Phase 4.

The share of small business respondents reporting production delays also rose, from 9.5% at the end of Phase 4 to 12.4% at the end of Phase 5.

The SBPS also asks whether the availability of other supplies or inputs used to provide goods or services affected operating capacity. Here, too, the percentage who said “yes” went up, from 10.9% at the end of Phase 4 to 15.0% at the end of Phase 5.

Jane Callen is the senior writer/editor in the Census Bureau’s Communications Directorate.