If the economy doesn\u2019t reopen soon, most U.S. small business owners predict they won\u2019t make it to the end of 2020. Many say they won\u2019t even make it to the end of the summer.<\/p>\n\n\n\n
Right around the time that President Trump signed the\u00a0coronavirus relief plan\u00a0<\/a>into law, a team of economists at Harvard University, the University of Illinois, and the University of Chicago asked thousands of business owners how the pandemic was impacting their operations. Seventy five percent said they only have enough accessible cash to cover two months of expenses or less. And some industries are in dire straits.<\/p>\n\n\n\n \u201cThere\u2019s a real fragility that small businesses have,\u201d says Alex Bartik, assistant professor at the University of Illinois, and one of the study\u2019s co-authors<\/a>. \u201cVery few have the kind of cash on hand where they could keep their doors open for a sustained time period, given the current crisis.\u201d<\/p>\n\n\n\n Across a sample of more than 5,800 small business owners polled between March 26 and April 2, 41.4% reported that they were temporarily closed because of COVID-19, and that their workforce had been cut by an average of 40%.<\/p>\n\n\n\n But the future looks particularly gloomy for restaurants, bars, and other businesses that rely on face-to-face contact with customers.<\/p>\n\n\n\n Business owners in tourism and lodging predict there\u2019s a 66% chance they\u2019ll still be open at the end of 2020 if this crisis lasts just one month. Those in the \u201cpersonal services\u201d category\u2014businesses like beauty salons and gyms\u2014say they stand a 57% chance of surviving past the one-month mark (For states like Washington, New York, and California, which have been battling the pandemic since March or earlier, that month has already come and gone).<\/p>\n\n\n\n The longer business owners were asked to imagine the coronavirus crisis lasting, the more dire their predictions were.<\/p>\n\n\n\n Personal services business owners predict they have a 48% chance of making it to December 31 if the crisis lasts for four months, and a 27% chance if it lasts for six. Restaurant owners, one of the industries that has been dealt the biggest blow by the pandemic, predict they stand a 30% chance of surviving a four-month crisis; and a meager 15% chance if it lasts six months.<\/p>\n\n\n\n That doesn\u2019t mean that every small business in these industries is doomed if the coronavirus shutdown stretches past a few months, Bartik says. Many have access to lines of credit designed to help combat price fluctuation and other uncertainties. But most businesses \u201caren\u2019t set up to have revenue go to zero for a sustained period of time,\u201d he says. Inevitably, the sudden loss of income will force some to look to other types of debt \u2014 or file for bankruptcy.<\/p>\n\n\n\n Small businesses \u2014 defined by the Small Business Administration as those with fewer than 500 workers \u2014 employ almost half of the U.S. workforce. Congressional stimulus packages, Bartik says, will be vital in the fight to keeping them afloat.<\/p>\n\n\n\n The majority of small business owners surveyed by his team (72%) said they would want to apply for loans via the Paycheck Protection Program (PPP)<\/a>, part of the multi-trillion-dollar CARES Act stimulus package <\/a>that issues grants for businesses<\/a> that keep a certain percentage of employees on payroll. But as of April 16, those funds have already dried up, according to the SBA.<\/a><\/p>\n\n\n\n \u201cIt\u2019s a big deal, and not just for owners of businesses,\u201d Bartik says. \u201cWhether or not they can survive through this crisis will have a big effect on a lot of Americans ability to get back to work.\u201d<\/p>\n\n\n\n Originally published at Money<\/a> by Kristen Bahler<\/a><\/em><\/strong><\/em><\/p>https:\/\/money.com\/coronavirus-small-businesses-loans-survive\/<\/a><\/cite><\/blockquote>\n\n\n\n <\/p>\n","protected":false},"excerpt":{"rendered":" If the economy doesn\u2019t reopen soon, most U.S. small business owners predict they won\u2019t make it to the end of 2020. Many say they won\u2019t even make it to the end of the summer. Right around the time that President Trump signed the\u00a0coronavirus relief plan\u00a0into law, a team of economists at Harvard University, the University […]<\/p>\n","protected":false},"author":1,"featured_media":205,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"inline_featured_image":false,"footnotes":""},"categories":[5,2,9,6,3,7,8,4],"tags":[18,21,22,20,23,16,19,11,14,13,17,12,10,15],"_links":{"self":[{"href":"https:\/\/www.remotebharat.com\/resources\/wp-json\/wp\/v2\/posts\/204"}],"collection":[{"href":"https:\/\/www.remotebharat.com\/resources\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.remotebharat.com\/resources\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.remotebharat.com\/resources\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.remotebharat.com\/resources\/wp-json\/wp\/v2\/comments?post=204"}],"version-history":[{"count":1,"href":"https:\/\/www.remotebharat.com\/resources\/wp-json\/wp\/v2\/posts\/204\/revisions"}],"predecessor-version":[{"id":206,"href":"https:\/\/www.remotebharat.com\/resources\/wp-json\/wp\/v2\/posts\/204\/revisions\/206"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.remotebharat.com\/resources\/wp-json\/wp\/v2\/media\/205"}],"wp:attachment":[{"href":"https:\/\/www.remotebharat.com\/resources\/wp-json\/wp\/v2\/media?parent=204"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.remotebharat.com\/resources\/wp-json\/wp\/v2\/categories?post=204"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.remotebharat.com\/resources\/wp-json\/wp\/v2\/tags?post=204"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}