With Pandemic Surging, Will Small Businesses Get the Relief They Need?

If there's one thing the last few weeks should have shown us, it's that Shop Small shouldn’t be relegated to one day of the year. At least, it can't be if millions of small companies are going to survive the deadliest flu season in modern American history. To survive, small businesses need help from consumers and from government to make it through the pandemic. Supporting small businesses should be a movement.

There is little doubt that small businesses have struggled through the pandemic and now are bracing for the second wave of the coronavirus. Local governments mandated temporary closures and implemented capacity restrictions, and, as people stayed home, demand decreased for products and services, and delays due to supply-chain issues led to unprecedented challenges for small business owners.

“By shopping small and supporting your favorite small businesses — both in store with appropriate COVID-19 precautions and social distancing, as well as online — you’re doing your part to overcome the economic hardships brought on by COVID, all holiday season long,” says SBA Atlantic & Mid-Atlantic Regional Administrator Steve Bulger.

As the number of cases, hospitalizations, and deaths rise following the Thanksgiving holiday, the possibility of another shutdown is real. This could not come at a worse time for small businesses, particularly independent businesses and retailers. Upcoming research from Biz2Credit will show the severe negative impact that the pandemic is having on these mom & pop stores, while large companies continue to do well.

For instance, in hard-hit New York State, small business owners received a combination of 652,000 SBA Economic Injury Disaster Loans and Paycheck Protection Program (PPP) funding totaling $56.3 billion -- with a lion’s share in metro New York, according to Bulger.

The PPP loans gave a lifeline to small business owners that are overextended with debt and trying to overcome decreases in demand as millions of Americans began to work from home. Restaurants and other businesses that catered to commuters in big cities, like my own NYC, are racking up debt because of decreased revenues and stagnant or even increased costs. Even after indoor dining restrictions and other measures eased, many companies are spending more money than they bring in.

In total, the SBA and the Treasury Department made about 5 million “forgivable” PPP loans, totaling $531 billion, through August 8. Business owners received funding to stay afloat for a little while; but much of that funding is now exhausted. Now it is up to consumers to support them during the critical holiday shopping season. Small businesses are pillars of local communities and are responsible for nearly two-thirds of private sector jobs. If we want to have vibrant downtowns and local residents employed where we live, we must patronize small businesses.

Government, too, is being asked to lend a hand. Negotiations are ongoing in Washington to create another economic stimulus bill. Just this week, we heard news that a bipartisan group has proposed a stimulus package that would include a second iteration of the Paycheck Protection Program. The amount and the details must be worked out, but almost everyone recognizes that without financial help, countless businesses will close because of the coronavirus. They simply don't have the resources to outlast the pandemic.

Meanwhile, a vaccine is on the way, and there is hope that the new year may bring better times ahead. But with the impact of those public health measures potentially taking months to show up, it may be too late for many business owners. We all have to do our part to make sure that small businesses make it to that point.