Poll: Small Business Will Continue to Face Closures in 2021 Due to COVID

Poll: Small Business Will Continue to Face Closures in 2021 Due to COVID https://ift.tt/eA8V8J

It may be a new year, but many small businesses are still reeling from unparalleled obstacles caused by COVID-19. Many of them are now deliberating how they will survive during the pandemic.  And regrettably, the picture may get bleaker before it gets brighter. That could particularly be true for Black businesses who have — and remain — among the most devastated among smaller establishments affected by the crisis.

A new poll by the advocacy group Small Business Majority shows small business owners of color continue to face closures nearly a year into the pandemic. They keep facing major revenue losses. As such, many have found it hard to stay solvent. Some 32% have cut employee hours and 24% have shut down. Sixty percent have not replenished their headcount to pre-pandemic levels after cutting staff last year.

Further, small business owners foresee more cuts in the next three months to cope with
the challenging economic landscape, markedly minority firms. Some 48% of Black entrepreneurs are likely to change their business model dramatically and 35% expect to cut employee hours. Some 32% expect to close for a short time, 23% close an office or location, and 18% shutdown forever. Unfortunately, Black businesses had most of the highest percentages for calamities in those areas than other groups.

The poll included 500 small businesses, with oversamples from 300 Black, 300 Latino, and 150 Asian American Pacific Islander entrepreneurs. It was done by Lake Research Partners for Small Business Majority.

The findings come as President Joe Biden is pushing for a $1.9 trillion COVID-19 relief package to help  American individuals and businesses to endure the pandemic economy.  Proprietors also are facing revenue declines despite state and federal efforts to offer many emergency funding.

Though some small businesses have secured federal support, the survey showed small business owners struggled to navigate funding programs last year. Some 57% of those who applied for the Paycheck Protection Program (PPP) reported the application process was difficult. Just 33% got the full loan amount they requested. And minority-owned businesses were less likely to get the full amount sought, including 27% Latino and 23% each for Black and AAPI.

Rochelle Smith, owner of Eliteress Beauty in Cypress, Texas, told Small Business Majority about some of her challenges. “Applying to federal relief programs has been incredibly complicated from the start, especially for small minority and women-owned businesses.”

She added, “Small businesses like mine should receive a fair shot at applying to those programs. If my business is denied for this second round of PPP, I’m not sure how I’ll keep my business alive while the pandemic continues to drag on.”

The Small Business Majority reported the weeks ahead will prove to be even more challenging as small business owners anticipate making further cuts.

“As these survey results make clear, small businesses urgently need Congress to work with the Biden administration to pass a comprehensive federal relief plan that will put small businesses on a meaningful pathway to recovery,” stated John Arensmeyer, founder & CEO of Small Business Majority.

He continued, “While temporary solutions to provide emergency funding have provided an important lifeline to small businesses, they need bold measures to see them through the challenging months ahead. Another wave of layoffs and business closures is on the horizon if Congress doesn’t act swiftly.”

 

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