PALMER — Earlier this month, the Matanuska-Susitna Borough Assembly released the responses to a survey aimed at assessing the impact that the COVID-19 virus has had on the Valley economy. The survey asked thousands of local businesses many questions to gage how the social distancing mandates have affected revenues, financial solvency, the change in number of employees, how many of the respondents have applied for any of the financial assistance programs, and more.
“We have thousands of small businesses in the valley and a lot of them have been shut down by the coronavirus and that has had a huge impact on their revenues,” assemblywoman Stephanie Nowers who headed the task force that conducted the survey said.
Of the 1,605 respondents, 98.69 percent employ 50 employees or less during their peak seasons. One of the criteria for businesses to apply for the AK CARES Grant Program is that they must have on average 50 employees or less. The program which offers financial relief to small Alaskan businesses began on June 1 and provides grants to eligible businesses that range from $5,000 to $100,000. As of June 17, businesses that have received $5,000 or less from the Economic Injury Disaster Loan funds or the Paycheck Protection Program and 501©(6) nonprofit organizations are eligible for the grant program if their business was licensed and was in Alaska when Gov. Mike Dunleavy declared the public health disaster emergency on March 11.
The results from the survey show that 41.31 percent of the respondents have applied for the assistance programs and 11.84 percent will, though these percentages have probably changed.
‘Doing it again’
“I could see us doing it again,” Nowers said regarding the data and ongoing economic situation, “it does change so quickly.”
Businesses in certain industries are affected worse than others. Of the 28 listed industries, the pet care, entertainment, transportation, hair/spa, fitness/recreation, and education/childcare are six industries that have the greatest proportion of respondents that say their businesses will be financially insolvent within one to two weeks. The pet care industry has the greatest percentage in this time frame at 44.4 percent and education/childcare having the lowest of the top six at 20.27 percent.
According to the University of Alabama at Birmingham, insolvency means that the business is unable to pay its debts on time but does not mean bankruptcy.
The business may continue to operate and/or pay its debts, but with much difficulty.
For the time frame of one to three months, the top six industries are: manufacturing at 70.83 percent, event planning/hosting at 66.67 percent, education/childcare at 62.16 percent, restaurant/food service at 60 percent, art at 55.56 percent, and media/communications at 55.55 percent.
Although the survey revealed much about the effects the coronavirus has had on the Valley economy, there is the possibility of some faulty sampling methods when conducting the survey.
Nowers said that the survey was emailed to more than 6,000 licensed businesses throughout the borough and shared the survey on Facebook. A nonresponse bias would skew the results since some businesses may chose not to answer the survey.
Some may not respond if they were not greatly affected by the pandemic. A voluntary response bias may skew the results by over-representing a proportion of businesses, in this case businesses that were greatly affected by the pandemic.
The wording of the questions can also be a consequence of the survey. Some of the businesses may have felt the wording of the questions to be confusing, or there could have been leading questions.