1 in 4 execs say their business may not survive COVID

Nearly one in four executives on Long Island said their businesses might not survive the pandemic, according to a poll released on Thursday.

But while 23% said their future is in doubt, another 34% — more than one in three — said their firms would be stronger than before.

More than half of the executives who said their businesses are struggling are in the food, beverage and retail industries. They were shut down for months to slow the coronavirus’ spread and many still operate with capacity limits.

Many of those who expect their firms to emerge stronger are in the engineering, construction and finance sectors.

Another 43% of the 418 respondents in the Long Island Business Leaders Survey predicted their company would emerge from the pandemic in about the same condition as before COVID-19 struck a year ago.

"Long Island businesses have gotten punched in the face," said Don Levy, director of the Siena College Research Institute, which conducted the online poll Feb. 5-26 for the Long Island Association business group. "The pandemic has cost jobs; it’s cost money, and CEOs have had to figure out new ways of doing business."

Levy said business executives in Nassau and Suffolk counties don’t anticipate the bottom-line damage caused by COVID-19 to be quickly repaired.

Sixty percent said their company’s financial performance this year will be either about the same or worse than in 2020. Another 40% predicted a better performance, year over year.

Among the poll respondents, 50% are in the service sector and 70% have 50 or fewer employees on Long Island.

Other notable results from the wide-ranging poll include:

• 80% of executives said COVID remains their No. 1 challenge

• More than 70% blamed the pandemic for a decline in their company’s revenue and profit

• 55% of executives reduced their workforce because of the virus' impact

• 98% increased the availability of working from home and 73% said they would keep that change for some time

• 72% of businesses received a Paycheck Protection Program loan or other federal aid; 56% are seeking additional help from Washington

• Nearly 60% of the food, beverage and retail companies were late in making rent, mortgage or tax payments last year, compared with only 21% of all businesses

• One-third of executives said they would require employees to be vaccinated before returning to the workplace

"With the additional federal funding for businesses and governments [in the new stimulus package adopted by Congress], the Long Island economy should be able to turn around fairly quickly, potentially even by the latter part of 2021 and definitely in 2022," poll respondent Ming Chiang, president of Amityville-based Casual Home Worldwide Inc., said in an interview.

"My one concern is how quickly the vaccine rolls out, so we can bring our staff back to the office at full capacity," he said, adding about two dozen of his 600 employees work locally. "With people working remotely, the productivity did drop."

Chiang said demand for Casual Worldwide’s furniture and home goods has increased during the pandemic as shoppers decorate the homes that they’ve been spending more time in. However, he said his new company, Biacomm Inc., also in Amityville, was forced to postpone the introduction of its first products: industrial lights powered by solar panels.

Chiang was among the more than six in 10 executives who predicted tax increases this year as the federal, state and local governments try to close COVID-related budget deficits. "Any tax increase would affect our bottom line," he said.

LIA president and CEO Kevin Law said, "The survey should serve as a red flag to state legislators that any efforts to raise state income taxes will slow down the post-COVID recovery of our economy and chase individuals and businesses out of the state."

He said the poll results also show "the dramatic impact on commercial real estate" from the pandemic: 55% of executives reduced their office space in the past year and 86% said they aren't planning to reverse that decision.

Margo K. Cargill said she wasn’t sure her Uniondale firm, Titanium Linx Consulting Inc., would survive the pandemic when she took the LIA/Siena College poll last month.

She had lost the opportunity to bid on a $500,000 state contract and been forced to cut the hours of two part-time employees. Plans for a new office and additional employees have been put off to mid-2022, she said.

"It’s been devastating because we were doubling our revenue year after year before COVID," Cargill said. "So, I was uncertain about the future when I participated in the poll in February. But lately, I’ve been trying to think more positively…I think we will stay afloat."

By James T. Madore

james.madore@newsday.comJamesTMadore

James T. Madore writes about Long Island business news including the economy, development, and the relationship between government and business. He previously served as Albany bureau chief.