SW La. businesses hurting
Survey: 94 percent feeling negative impact from pandemic
A survey conducted from mid- to late-March revealed 94 percent of 238 Southwest Louisiana businesses felt the impact of the COVID-19 pandemic.
The Southwest Louisiana Economic Development Alliance and McNeese State University released results from the survey, done March 16-27. Nearly 43 percent of businesses said they expect a significant sales and revenue drop during the first and second quarters of this year. Another 27 percent said a major risk was anticipated.
While just over 5 percent of surveyed businesses expect sales and revenue to stay on track, most of those responses happened before Gov. John Bel Edwards issued a stay-at-home order on March 22.
“This is constantly changing,” Dan Groft, director of the H.C. Drew Center for Business and Economic Analysis at McNeese, said on Thursday.
The bulk of responses came from small businesses in the survey’s first week. Groft said those surveyed after the governor’s stay-at-home order had less of an optimistic view, with only one business stating it was not impacted by the virus.
The service industry, including casinos, hotels and restaurants, are being hit harder than manufacturing and industry, including refineries, Groft said. Such a shutdown of the service side of the economy hasn’t been seen before, he said.
“I think that will hurt us a lot more because they bring in a lot of sales from outside our area,” Groft said. “We used to always tell people our economy is going to be resilient because we switched to services. At least manufacturing is still going. It’s good we have that in place.”
The local service industry will likely feel more of an impact than other areas of the state, Groft said.
“You don’t have a lot of gaming people coming from Texas to visit Alexandria,” he said.
Most businesses said customer demand was the hardest hit by coronavirus, followed by business development, such as travel, meetings and conferences. Supply chain and employee availability were also impacted.
Fewer than half of the surveyed businesses said they need assistance or information on recovery. That number grew after Edwards’ stay-at-home order.
“We are constantly adapting to this situation personally and on a business level,” Groft said. “That’s going to happen with recovery.”
More than 72 percent of businesses said they were planning travel restrictions or had already put them in place. More than half said they have either canceled projects or expect them to be postponed or canceled.
The survey showed more businesses planned to cut their hours, shifts or work days, especially after Edwards’ stay-at-home order.
The U.S. Department of Labor reported more than 102,000 new unemployment claims statewide last week.
“I don’t think any part of the state is going to be spared, even us,” Groft said.
Recovery for restaurants and casinos won’t happen overnight, Groft said.
“After April 30, we hope all these things go back online,” he said. “But people will be trepidatious to go out. A lot of people are hoping for a V-shaped recovery, but it will more likely be U-shaped.”
A recent economic study released by theNational Bureau of Economic Research showed 37 percent of jobs could be done at home. However, that applied to roughly 21 percent and 26 percent of jobs in the Lake Charles metro area.
“Our economy is not built for people to work at home from their laptops at the moment,” Groft said.
Groft said businesses are learning how to use remote software to get through this time.
“I think we could see a change in how wework going forward,” he said.
George Swift, alliance president and CEO, said results from the survey will aid in suiting programs to meet the needs of area businesses. He said it will also guide elected officials when determining policies that will benefit companies.