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Five Years Post-COVID: How SMBs Have Redefined the New Normal

ExtensisHR7 minute read
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Quick look: Five years after COVID-19 upended daily life, much of the world has returned to normal, but lasting changes remain—especially in the workplace. From a demand for flexibility to an increased focus on well-being, here’s how the pandemic has shaped employee expectations and how professional employer organizations (PEOs) help small businesses succeed in any environment.

2025 marks a significant milestone: half a decade has passed since the COVID-19 pandemic brought the world to an unexpected standstill.

Five years later, much of the life we knew before the virus took hold has returned. For the most part, we shake our colleagues’ hands and explore public spaces unmasked without worry.

However, some ripples remain, particularly the impact of COVID-19 on how we work. Below, we look back at the pandemic, its lasting mark on the workplace, and how small businesses fared during and after.

A look back at COVID-19

The first confirmed case of COVID-19 in the U.S. occurred on January 20, 2020, in Washington state. Less than two months later, on March 15, 2020, other states began implementing shutdowns to curb the virus’s spread. By the end of the year, over 80 million cases had been confirmed globally, with 21 million of those in the U.S.

The pandemic had a significant impact on working Americans and the economy. The national unemployment rate rose from 3.6% in January 2020 to nearly 15% in April that year. Additionally, it caused:

The first COVID-19 vaccines were introduced in December 2020, and by mid-March 2021, almost 100 million doses had been administered in the U.S. That month, unemployment also dropped to 6%.

In March 2025, the time this blog was written, the national unemployment rate stood at 4%, and approximately 7 out of 100,000 hospitalizations were due to the virus (compared to nearly 35 during the same period in 2021).

3 post-pandemic workplace trends

While many of the economic and public health challenges related to COVID-19 have faded, the pandemic made a lasting impact on how we work and what talent expects from their employers. Here’s how:

1. Continued demand for flexibility

The virus’s exponential spread caused a sudden, substantial shift to remote work. A recent Pew Research Center study found that just 14% of employees who can do their jobs from home say they worked remotely before the outbreak. By October 2020, 55% of those with teleworkable jobs were doing so, and in October 2024, 43% worked from home at least some of the time.

This flexible arrangement quickly enhanced job satisfaction and became a long-term expectation for many. According to Pew, 73% of those who work from home at least sometimes say it helps them balance their work and personal lives. Additionally, 60% state remote work helps them complete their work and meet deadlines.

These advantages are important to employees. The same Pew report found that when asked if they would stay if their employer discontinued remote work, 46% of all workers, 49% of women, and 50% of staff ages 18-49 would likely leave.

 2. A focus on holistic well-being

The unprecedented COVID-19 crisis changed how workers view their well-being and employee benefits.

Over three-quarters of people said the pandemic caused them to pay more attention to their overall health—and they want their companies to care, too. Further, MetLife’s 2024 Employee Benefit Trends Study found that:

  • Only 63% of employees think their employer cares about their unique circumstances, challenges, and needs
  • 86% of workers have experienced a significant unplanned financial stress/expense, but only 48% agreed their organization demonstrated care regarding the experience
  • 81% of employees were majorly impacted by an ongoing mental health condition, however, just half felt their company demonstrated care

Having access to and being pleased with the right benefits pays off. MetLife’s report states that those who have and are satisfied with their employer-provided plans feel almost twice as holistically healthy as those without benefits. Additionally, when staff are happy with their benefits, they are:

  • 6x more likely to be productive
  • 5x more likely to be engaged
  • 5x more likely to be loyal

These figures signal the opportunity for organizations to demonstrate personalized care through their benefit offerings. Plans tailored to personal well-being are no longer novel; they’re expected and can boost employee wellness and business performance.

3. A push for a positive culture

In the last five years, company culture has increasingly become a deciding factor in where people choose to work and whether they stay. Besides lack of flexibility, a toxic or unsupportive culture is now a top reason employees leave jobs, as many people reassessed their priorities during the pandemic.

Today’s talent, especially younger generations like Gen Z, many of whom have entered the workforce since the pandemic’s onset, want their employers’ values to align with their own. For instance, Deloitte’s 2024 Gen Z and Millennial Survey found that half of Gen Zers have declined an assignment or project based on their personal ethics or beliefs, while 75% consider an organization’s community involvement and societal impact a key factor when assessing potential career opportunities.

A sense of connection and belonging is also crucial to today’s workforce. Due to the rise of remote and hybrid work, employees look for companies that foster community, collaboration, and inclusivity.

The proven strength PEOs gave SMBs

The unexpected, drastic changes that unfolded five years ago rocked virtually every organization, especially smaller-sized ones.

However, many small- and medium-sized businesses (SMBs) that had partnered with a professional employer organization (PEO) were sheltered from the pandemic’s harshest effects. PEOs, a type of human resource (HR) outsourcing provider, help their customers manage numerous aspects of their HR, employee benefits, payroll, risk management and compliance, and more.

The National Association of Professional Employer Organizations (NAPEO) found that during COVID-19, SMBs with a PEO:

  • Were 119% more likely to have received Paycheck Protection Program (PPP) loans, 91% less likely to close temporarily, and 60% less likely to permanently close doors
  • Experienced an 81% higher employment growth rate between July 2020 and June 2021
  • Largely (72%) returned to a normal level of operations by July 2021

ExtensisHR: here to help you succeed through any event

PEOs are committed to helping SMBs in both steady and uncertain times, providing a proven competitive edge.

However, not every PEO is the same. While many have similar core offerings, what differentiates them is their level of customer service and ability to tailor solutions to meet customers’ specific needs.

ExtensisHR, a national PEO, proudly supports customers through every challenge, with:

Are you interested in exploring how ExtensisHR can support your business, no matter what lies ahead? Learn more about our PEO solution, or contact us today.

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