Small Business Getting Walloped by Pandemic Closures

As the state of California faces new public health orders to mitigate the spread of COVID-19, a new Small Business Majority scientific poll released this week (Dec. 16) sheds light on the distressing effects the pandemic has had on small business owners across the state. The poll reveals California business owners continue to face uphill challenges to keep their doors open, and entrepreneurs of color are more likely to close their doors in the next few months than their white counterparts. The results stress the need for Congress to act swiftly to pass additional federal relief in order to prevent closures and help amplify the Bay Area Council’s campaign to sound the alarm on California’s worsening business climate.   

According to the poll, one-third of small businesses have cut employee hours, a quarter have reduced employee wages and another quarter have changed their business model. The survey finds that entrepreneurs of color are more likely to have taken these drastic steps. Closures are becoming inevitable for entrepreneurs of color, with 28% reporting they may be forced to temporarily close their business in the next three months, and 17% say they are likely to close their business permanently.

Additionally, of those employer firms that reduced their number of employees during the pandemic’s height and economic downturn, more than 60% report they still have not restored their headcount to pre-pandemic levels.