CFOs hopeful about reopening amid coronavirus, but employees remain fearful

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CFOs are cautiously planning to reopen their companies despite the novel coronavirus pandemic to stem the mounting tide of revenue losses, but employees are worried about whether they can return to work safely.

PricewaterhouseCoopers’ fifth biweekly COVID-19 CFO Pulse Survey found 55 percent of the 288 CFOs and finance leaders polled are projecting revenue and profit losses to be more than 10 percent this year, up 2 percentage points from the prior survey. Nearly one-third (31 percent) of CFOs expect layoffs in the next month, a 1 percentage point decrease from two weeks ago.

While 80 percent of the CFOs polled are considering cost containment measures, that’s down from 86 percent two weeks ago. Fewer CFOs are anticipating furloughs over the next month (36 percent, compared to 44 percent two weeks ago).

CFOs are feeling more confident about their ability to protect employees once they return to the workplace. Nearly two-thirds (64 percent) of the survey respondents indicated they’re “very confident” their company can help create a safe workplace environment for employees. Eighty-three percent of respondents plan to change workplace safety measures, up six points from two weeks ago, while 43 percent of the CFOs polled expect to make remote work a permanent solution for roles that can accommodate it.

“One of the clear things we’re seeing right now is that the initial shock of the virus and its effect on the business community is over and we’re seeing a real shift among executives focusing on what they can control,” said PwC US chair and senior partner Tim Ryan during a conference call with reporters Monday. “It’s very clear to us that the most successful companies will be the ones who focus on four critical things, and it’s all around the theme of what they can control. We’re hearing an awful lot about culture, employee safety and employee experience, revenue generation strategies, and cost management, not only today but going forward in the future.”

Last week, along with CFOs, PwC surveyed more than 1,100 American workers to learn the employee perspective. It found they were far less confident that their workplace or commute would be safe. Of those, 39 percent were forced to work remotely or stop working altogether, but are still getting paid. Within this group, more than half (51 percent) said the fear of getting COVID-19 would prevent them from going back to the workplace if their employer asked. Nearly a quarter of the employees (24 percent) said they’re unwilling to use public transportation for their commute and 21 percent cite their responsibility as a parent or caregiver as a reason preventing them from going back to the workplace.

“It goes to our point that you can lead with safety and PPE, but all workers are different,” said Bhushan Sethi, global people and organization co-leader at PwC. “What was interesting in that consumer survey is that 30 percent of them said nothing prevents me from coming back. It shows the different needs for some people who feel they need to be back in a physical workplace, whether it’s out of necessity, fear of job loss, or to be part of the working culture. As firms slowly, steadily, in a sequenced way over the next 12 to 18 months transition back to a physical workplace, they really need to understand the design or the individual considerations that people need.”

Workers are right to be fearful, given the dangers of the deadly virus. “Given the unprecedented nature of this global pandemic, it is clear that workers are very worried about being able to stay healthy and safe as they are asked to return to their offices and worksites,” Ryan said in a statement. "The most important thing business leaders can do to address their employees’ worries is to communicate frequently and transparently about how they are working behind the scenes to keep them safe, healthy and employed.”

PwC has created Check-In with Automatic Contact Tracing, a tool that helps companies identify and alert employees who may have come into contact with a co-worker who has tested positive for COVID-19.

More from the survey

For the first time in the survey, over half (58 percent) of CFOs anticipate that it will take at least three months for their company to return to “business as usual” if the virus were to end today. While 85 percent of respondents expect that COVID-19 will decrease their company’s revenue and/or profits this year (up five percentage points), 6 percent of respondents report that COVID-19’s impact on revenue and/or profits is still too difficult to assess at present (down six percentage points).

In addition, 20 percent of respondents expect a decrease in revenues and/or profits of 25 percent or more. Meanwhile, 58 percent of the CFOs polled are considering deferring or canceling planned investments (down 12 percentage points). Of these respondents, 80 percent (the same as two weeks ago) are considering delaying or canceling facilities/general capital expenditures. In addition, 57 percent (versus 62 percent two weeks ago) are considering workforce investments and 48 percent (the same as two weeks ago) are considering IT investments.

Seventy-three percent anticipate reconfiguring work sites to promote physical distancing (up eight percentage points), while 58 percent expect to change and/or alternate shifts to reduce exposure (up six percentage points).

Many CFOs are still expecting layoffs, furloughs and other cost reductions. “In terms of cost cutting, 80 percent are considering cost containment measures,” said PwC's chief clients officer Amity Millhiser. “This is down slightly from the last time we ran the survey, but it’s still the overwhelming majority of the CFOs. In terms of the areas of cost cutting, the expectations of layoffs over the next month seem to be holding steady at about 31 percent. Fewer CFOs are anticipating furloughs over the next month. This time, it’s 36 percent versus 44 percent two weeks ago. These statistics reflect that in those industries that were most significantly affected out of the gate by the COVID virus — think about the hospitality industry, travel industry and retail industry — many of them have already taken layoffs and furlough actions early on in the past couple of months, so these numbers probably reflect the significant actions those sectors have taken already.”

PwC isn’t the only Big Four firm that has been surveying CFOs lately about the coronavirus pandemic. Deloitte released a survey last Wednesday of a group of 166 CFOs. It asked them how long it will take for recovery to pre-crisis levels: Nearly 60 percent said they do not expect their operations to return to near-normal levels in 2020. The retail/wholesale sector is especially pessimistic.

Deloitte also asked how organizations plan to resume business operations and succeed in this environment. Approximately half the CFOs polled said they plan to open local offices and operations as soon as their local and/or state governments allow it. Around 60 percent of the CFOs surveyed said their investments in technologies for virtual and automated business operations will increase over the next 12 months. When asked what kinds of changes they expect in their workforces, about two-thirds of the CFOs polled say they expect their workforce to be within 10 percent of its current size a year from now. The retail/wholesale and services sectors are the most likely to expect substantial reductions.

Research firm Gartner has also been polling CFOs about their attitudes. In the latest poll, conducted May 3, Gartner surveyed 161 finance executives, and found that in May and June the number of companies furloughing staff, as well as cutting salaries and workforce, will have more than doubled since the end of March. Eleven percent of the respondents said they reduced staff in March, and 25 percent plan to reduce their staff in May and June.

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