LOS ANGELES--()--That bug that’s going around might be bugging your bottom line if you are a small business owner, according to a new survey from Pepperdine University, conducted in partnership with Dun & Bradstreet Credibility Corp.
“One possible explanation is that absenteeism is more likely to result in business interruption for small firms because there might not be anyone to temporarily cover for the responsibilities of the missing employees.”
The flu outbreak has hindered growth opportunities and the ability to hire people, according to the overwhelming majority of businesses taking part in a survey by the Pepperdine Private Capital Markets Project, ongoing small business financing research at the University’s Graziadio School of Business and Management and publishers of the quarterly Private Capital Access (PCA) and Private Capital Demand (PCD) Indexes.
Of the 679 privately-held businesses across the United States taking part in the survey, 9 percent reported the flu hindered opportunities for growth, and 3 percent reported problems hiring because of the flu.
“The perception that the flu outbreak is hindering their opportunities for growth is somewhat surprising because the flu is a temporary condition that should not impact the trajectory of the company. The fact that nearly one out of ten respondents said ‘yes’ is both unexpected and troubling,” said Dr. Craig Everett, assistant professor of finance at Pepperdine and associate director of the Pepperdine Private Capital Markets Project.
Though most companies surveyed said they had no one out with the flu at the time of the survey -- Jan. 14-27 -- there were 84 companies reporting at least one person out, with fewer saying there were multiple employees out and one company reporting more than 50 people out.
There’s a direct dollar cost to companies experiencing employees out due to the flu.
Smaller companies -- those with revenues of less than $5 million -- reported each sick employee cost them an average of $22,802. For larger companies, the average cost per sick employee was $15,806.
And though flu shots for employees might help, employers considered their own bottom line as well: 77 percent of companies did not arrange for shots; 20 percent provided them at no cost to the employees, 2 percent offered them at a discount, and 1 percent offered them, but the employee had to pay.
A higher percentage of large companies provided shots as opposed to smaller ones. Employees at smaller firms tended to stay out sick longer -- 7.4 days vs. 3.6 days for employees of larger firms.
“It is clear from our survey results that the flu outbreak has impacted small businesses more severely than medium and large businesses,” said Jeffrey Stibel, chairman and CEO of Dun & Bradstreet Credibility Corp. “One possible explanation is that absenteeism is more likely to result in business interruption for small firms because there might not be anyone to temporarily cover for the responsibilities of the missing employees.”
Telecommuting or working from home was an option, but not one that was used very much; 106 companies said one employee worked from home, 46 said two worked from home but most said no one did. Larger companies reported a higher percentage of sick telecommuters -- 75.4 percent -- than did smaller companies (38.4 percent).
Leading the survey were Dr. Craig Everett, assistant professor of finance at Pepperdine and associate director of the Pepperdine Private Capital Markets Project; and Dr. John K. Paglia, associate professor of finance and director of the Pepperdine Capital Markets Project.
The Pepperdine Private Capital Markets Project seeks to understand the true cost of private capital and the investment expectations of private business owners, providing lenders, investors and the businesses that depend on them with critical data to make optimal investment and financing decisions. The Project’s small business owner surveys draw their sample from a database of businesses maintained by the Dun & Bradstreet Credibility Corp., research partners for the Pepperdine PCA Index Quarterly Reports and Economic Forecast. Reports and more information are available at http://bschool.pepperdine.edu/privatecapital.
About Pepperdine University Graziadio School of Business and Management
Founded on the core values of integrity, stewardship, courage, and compassion, Pepperdine University’s Graziadio School of Business and Management has been developing values-centered leaders who advance responsible business practice since 1969. Student-focused, experience-driven and globally oriented, the Graziadio School offers fully accredited MBA, Masters of Science, bachelor’s completion and non-degree executive business programs for business professionals, entrepreneurs, managers and senior executives at all stages of their professional and personal development. For more information, visit: http://bschool.pepperdine.edu/newsroom.
About Dun & Bradstreet Credibility Corp.
Dun & Bradstreet Credibility Corp. is the leading provider of business credit building and credibility solutions for businesses. The company helps businesses establish their credit with a D&B D-U-N-S® Number and provides the only business credit solution available to businesses looking to build, monitor, and impact their business credit and credibility. The company’s headquarters are in Los Angeles, CA with offices throughout the United States. For more information on the company, please visit www.DandB.com. Twitter: @DandB