If coronavirus closes small shops for more than three months, 35% say they can't reopen
One-third of small business owners reported that they don’t expect to survive for more than three months in the current coronavirus-impacted restrictions on shopping, dining and travel.
The many state and local government restrictions on closing non-essential businesses and the White House coronavirus guidelines on avoiding discretionary travel, shopping, eating in restaurants, bars, etc., is threatening the survival of many small businesses. According to a recently completed survey by WalletHub on the impact of coronavirus on small businesses, 35% of owners stated that they could survive up to only three months, and an additional 30% reported that they could survive up to six months in the current conditions.
“We surveyed the small business community, and more than 87% of small business owners say their businesses are hurting due to the coronavirus pandemic," said WalletHub CEO Odysseas Papadimitriou in an emailed statement. "There are a few clear reasons for this. For one thing, hardly any business is unaffected. It’s not like just a sector or two of the economy has taken a downturn. Most businesses are going to zero revenue, and most businesses can’t survive long without any cash flow.”
About 60% of small business owners don’t want the government to impose further restrictions on consumers shopping in their stores. However, despite those demands, consumers have completely shifted their shopping habits toward grocery stores and health care and away from everything else, based on data tracked by the analytics firm Womply.
Small business owners are reeling from the impacts of the revenue shortfalls from consumers no longer shopping in their stores. Based on the WalletHub survey, almost two-thirds (63%) expect to file for relief being granted in the new stimulus package. According to MarketWatch, the stimulus package will include $350 billion in forgivable loans for small businesses if they do not lay off employees.
Unfortunately, those government actions are already too late for many small-business employees. The WalletHub study reveals that layoffs are already widespread in the small business community, with more expected in the near future.
“Yes, most workers should be worried about their job security right now. One-third of small business owners say they have laid off employees due to COVID-19, and a slightly higher share – 36% – plan to do so,” said Papadimitriou in an emailed statement.