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What will summer 2022 be like for small businesses?

The summer season is a very important time for many small businesses, particularly those with seasonal products, or who rely on seasonal tourism. Sadly, this important period has been challenging and unpredictable for the past two years due to the impact of the coronavirus pandemic, leaving seasonal small businesses unsure if they can rely on what has traditionally been a pretty safe revenue period.

Good News: Consumers are Learning to Live with Coronavirus

Thankfully, for small businesses across the US, coronavirus appears to be much less of a threat to commerce this year. Anthony Fauci recently stated that, while the pandemic is still here, the country is no longer in “the acute stage” of the virus, and that now “people are starting to learn to live with the virus”. This attitude is echoed by federal and local governments, who are generally trusting citizens to take responsibility for their own health and safety. That means we are unlikely to see the kind of restrictions that hampered seasonal commerce in the summers of 2020 and 2021, even in areas with high COVID numbers.

For businesses across the country, this means a significantly more optimistic forecast for the summer season compared to the past two years. But it’s important to remember that, despite changing attitudes, the pandemic is not over, and its effects are still bound to impact consumer habits this summer. Business owners would be well-served in planning contingencies in case of coronavirus-related interruptions and catering to their consumers in a variety of pandemic-friendly ways.

Bad news: Inflation is Changing Spending Habits

One of the ways that coronavirus continues to impact businesses indirectly is through the challenging economic climate. Inflation, in particular, has been a squeeze on both businesses and consumers across the country. With the rising costs of materials and wages, it’s no surprise that many small businesses are having to raise their prices as a result. Bloomberg reports on a survey from the National Federation of Independent Business that around 40% of small businesses intend to raise their prices by 10% or more over the coming months.

With prices going up, consumers are rethinking their spending habits. For some, this means spending less on material items and more on experiences and vacations. For others, it’s about splurging infrequently on high-end, high quality items, rather than regular spending on cheaper goods. Then again, consumers worried about the possibility of an impending recession could be significantly reducing their spending this summer to prepare for a worst-case scenario.

All of this is important knowledge for seasonal small businesses preparing for the summer. Optimistically, this season could be an opportunity to appeal to cash-strapped consumers looking to spend on a unique experience or luxury product. Pessimistically, consumers may feel comfortable coming out to your business but may not have the money to buy anything.

Mixed bag: Recruitment Opportunities and Challenges

In the midst of wage inflation and workers being more clear about their demands of an employer, many small businesses are already finding it more difficult to hire and retain staff. For seasonal businesses preparing for summer, there is some good news and bad news when it comes to recruitment.

Good News: More Foreign Workers Available

The Biden Administration is responding to the recruitment crisis by providing 35,000 seasonal worker visas for businesses ahead of the summer. In the words of secretary of homeland security Alejandro N. Mayorkas, the H-2B visa program is “informed by current demand in the labor market” and aims to “help to support American businesses” recruit foreign workers into seasonal, nonagricultural jobs like those in many hospitality, tourism, and foodservice businesses. 23,500 of these visas are for returning seasonal workers, while the remaining 11,500 are reserved for workers from Central American and Caribbean nations like Haiti and Guatemala.

Bad News: Student Workers Want More

For seasonal businesses who rely on students to fill vacant roles during the summer months, this year may be a bit of a mixed bag. While relaxed restrictions and more relaxed attitudes towards coronavirus may result in more student applicants being available than in the past two years, changing economic factors mean that those applicants want more from their summer jobs.

In Sioux Falls, South Dakota, seasonal businesses are having to offer up to 47% higher starting wages to attract the teens and college students they normally hire. Meanwhile, small businesses like seasonal foodservice destination B&G Milkyway are having to devise retention programs to reward employees and returning workers.

Takeaway

Overall, all signs point to this summer being a more lucrative opportunity for small and seasonal businesses than the last two summers. Consumers are more comfortable frequenting businesses and there are fewer restrictions in place to prevent or dissuade them. On the other hand, economic pressures may mean slim profits, unless businesses can take advantage of clever marketing. When it comes to recruitment, businesses may find it hard to convince previous staff to return without a pay rise, but could take advantage of the foreign worker scheme to fill their gaps. All in all, we recommend cautious optimism with a realistic backup plan for seasonal businesses this summer.

Snagajob has many student and summer workers to fill your hiring needs.

Tom Quinn |
Tom (he/him) is a growth marketing manager at Snagajob helping small businesses find hourly workers.