The S&P 500 Has Seen Significant Recovery Post-COVID-19
Despite temporary moderate drops, the S&P 500 has managed to recover well beyond its all-time high, as the market upward trend has outpaced the initial drop due to the COVID-19 pandemic. Over more than 160% since its 2020 cutoff, the index is up, reflecting concern over the short-term impacts of the virus on businesses and individual investors. This growth underscores the resilience of the global economy as businesses seek recovery.
The Floyd Report On Employer Firms: The 2024 SBA Credit Survey Highlights challenges for Small Businesses
The 2025 report from the 2024 Small Business Credit Survey, conducted from September to November, highlights the struggles of small businesses. The survey results show that 3% more companies reported sales declines compared to gains over the last 12 months compared to 2018 and 2019 pre-pandemic years. Prior to 2021, the net positive share was around 35%, contributing to confidence. However, since 2021, the share below 39% remains, indicating an uneven recovery, especially in 2024 where 57% reported challenges in reaching customers and generating sales, ranking higher than hiring issues.
The Complex Landscape and Role of Large Companies
The emphasis on distinct groups in the findings reflects the tension between large and small businesses. For instance, the data from FactSet shows that 75% of S&P 500 stocks reported growth, yet the index benefits from a mix of industries, with tech companies, known for recurring revenue, holding a significant share. However, this broad coverage raises questions about whether support for innovations drives the confidence.
Customer Satisfaction and Financial Performance
Small businesses often face challenges that affect their ability to support each other effectively. As businesses face uncertainties, their cash flow becomes a primary concern. Similarly, matters of pricing, such as pulling in revenue with significantly higher prices, might not guarantee a sales improvement. These factors lower confidence and hinder recovery efforts.
Productivity and Market Dynamics
The analysis also reveals that small businesses likely rely on traditional banks for financing. While there are fewer big banks’ applications for loans, approval rates remain stable. However, satisfaction with lenders, particularly online ones, has declined, contributing to ongoing financial difficulties. Overall, the market hasn’t weighed negative assessments of small business financial health, which could be a clue for changes in credit policies.
The Market and Its Response
Despite efforts to address financial challenges, the market acknowledges the pressures on small businesses. These include a faster market response rather than a slowdown, and the same firm holding onto cash longer. Additionally, buyers have learned to balance finance with tangible tasks, with the median sale price rising 3% to reflect increased practicality.
