The survey estimates that President Trump’s extension of stay-at-home orders until at least April 30 means that 38% of small businesses won’t last more than a month, according to Harris.
Small businesses provide nearly half of total U.S. employment, but the coronavirus pandemic is forcing them to shed millions of jobs. More than 70% of businesses have seen their revenue drop at the start of the pandemic, according to the poll.
President Trump warned Americans that the next couple of weeks would be “painful.”
In the Harris poll, small businesses were asked how long they could last under current lockdown conditions: 83% of the small businesses that responded said two weeks, 75% said they could last one month, and 58% allowed for three months. That means potentially 25% of American small businesses will be out of business: Harris notes that “half of all small businesses say that at least one other small business depends on them.” So if you add up to half to those that depend on small businesses (13%), “and that’s more than one-third (38%) or 11 million American small business,” the Harris report says. (Harris polled 310 small businesses with fewer than 100 employees.)
U.S. restaurant industry lost $25 billion in sales
In the first 22 days of March, restaurants across the country lost more than 3 million jobs and $25 billion in sales, according to the National Restaurant Association. The group said that 44% of restaurants could not make enough revenue by offering takeout and delivery, so they closed temporarily.
The New York City restaurant industry has been particularly hard hit. In the first 22 days of March, $1.9 billion in sales and more than 250,000 jobs were lost, according to the New York State Restaurant Association.
“Our members are being tested across the state like never before. They’ve had to adapt on the fly as this situation isn’t changing by the week or day; it is changing by the hour or minute,” said Melissa Fleischut, president and CEO of the New York Restaurant Association.
Trump’s senior advisor and daughter Ivanka Trump recently said small businesses will be able to apply for the $350 billion in loans set aside in the fiscal stimulus package on Friday.
“Every restaurant in the state is trying to preserve cash right now so that they have funds to eventually open,” said Fleischut. “The loans will help pay expenses once businesses begin to reopen because they have little to no revenue coming in right now.”
In an effort to ease restaurants’ financial devastation in New York, Gov. Andrew Cuomo’s administration has waived penalties and fines for late payments of sales taxes for yearly and quarterly filers and instituted a moratorium on evictions. The State Liquor Authority adjusted regulations to allow restaurants offering takeout and delivery to also sell alcohol.
Weekly jobless claims double
A record shattering number of people – 6.648 million – filed unemployment claims last week, up from 3.3 million during the previous week.
“Next week will be bad again as layoffs mount and paperwork gets filled in,” wrote Peter Tchir, head of macro strategy at Academy Securities. “This should be a wake-up call to D.C. that we need better and more targeted programs to protect those who are 'serving' in the fight against the virus.” Three in four Americans have been ordered to stay home and observe the Trump administration’s social distancing guidelines until April 30.
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