Story at a glance
- Thirty-four percent of small business owners said they are either paying reduced rent or are delaying payment.
- Three percent of restaurant operators have gone out of business.
- Congress late last month approved more than $700 billion in relief funds to try to help prop up small businesses.
A new study projects more than 100,000 small businesses in the United States have permanently shut their doors since the coronavirus outbreak was declared a pandemic in March, according to The Washington Post.
The study conducted by economists at the University of Illinois, Harvard Business School, Harvard University and the University of Chicago estimates that about 2 percent of small American businesses have closed down for good due to lockdowns prompted by the COVID-19 outbreak. Researchers have been taking surveys of more than 50,000 small business owners that subscribe to the Alignable business network, a network of 4.6 million small businesses.
The restaurant industry has been particularly hit hard, with 3 percent of restaurant operators going out of business, according to the National Restaurant Association.
“Overall, our results suggest that the pandemic has already caused massive dislocation among small businesses,” the study says.
The economists tracking the small-business closures found 34 percent of small business owners said they are either paying reduced rent or are delaying payment, according to a poll taken by researchers April 25 to 27.
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Congress late last month approved more than $700 billion in relief funds to try to help prop up small businesses, with approximately 4.2 million of the 30 million small businesses in the nation receiving loans from the Small Business Administration, according to the Post. Many small businesses told the outlet, however, the funds aren’t designed well enough to help very small businesses that have large overhead costs.
As the coronavirus outbreak continued to spread throughout the United States in March, states all across the nation began ordering businesses deemed nonessential to close and placed residents under stay-at-home orders. The measure prompted millions of workers to be laid off or furloughed and small businesses to lose income for weeks.
Some states have started the process of reopening, but concerns that opening for business too soon has been voiced by health experts and lawmakers who warn of a rebound in coronavirus cases.
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