Pandemic's "cataclysmic" impact on entrepreneurs and small businesses

Via CBS News (February 23, 2021) — As the coronavirus continues to batter U.S. small businesses, new data from tax-prep service H&R Block suggests Black-owned firms are taking the biggest hit.

H&R Block's survey is the latest in a catalog of research detailing how Black-owned businesses have struggled in the past year. 

A Main Street Alliance/Color of Change poll released in October found that only 40% of Black business owners expected to remain open over the ensuing six months, compared with 46% of Asian respondents, 48% of Latinx owners and 55% of Whites.

The Federal Reserve Bank of New York found that small business ownership in the U.S. dropped 22% between February 2020 and April 2020, but Black ownership dropped 41% — the greatest decline among all racial groups during the depths of the pandemic.

Thousands of Black businesses have already closed for good. Part of the struggle for Black businesses stems from their difficulty securing bank loans during the first wave of the pandemic, while many report being left out of the Paycheck Protection Program, a federal lending initiative geared to smaller employers.

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9 million U.S. small businesses fear they won't survive pandemic

Via CBS News (February 10, 2021) — Three out of every 10 small businesses in the U.S. say they likely won't survive 2021 without additional government assistance during the coronavirus pandemic, a survey from the Federal Reserve Bank shows.

Considering there are roughly 30 million small businesses in the U.S., that means 9 million small firms are at risk of closing for good this year.

The outlook is even worse for minority-owned businesses: 8 in 10 said their company is in poor financial condition, according to the Fed survey, even after receiving limited help from Paycheck Protection Program loans and other small business relief efforts during the pandemic.

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