March 31, 2021
C-Suite Wednesday – Metropolitan Small Businesses Disproportionately Impacted by the Pandemic
A preliminary analysis of COVID-19’s economic impact on small businesses has revealed that metropolitan and coastal businesses were disproportionately affected by the pandemic. The SBA Office of Advocacy reports that in April 2020, the number of people in metropolitan areas who were working and self-employed was 21% lower than in April 2019. However, outside of those areas, the decline was only 13%. In subsequent months, the number of small business owners outside of metropolitan areas returned to pre-pandemic levels while metropolitan areas continued to see a decline.
Here are some of the other findings included in the SBA Office of Advocacy’s most recent Issue Brief:
- Overall, the number of people who identified as self-employed and working hit its lowest point during the pandemic in April 2020, falling 20% lower than in April 2019.
- Among metropolitan areas, New York City experienced the steepest decline in small businesses, dropping 44% in April 2020.
- A break-down of changes in working self-employment numbers by region reveals the decline was most severe in the Northeast, substantial in the South and West, and least severe in the Midwest.
- Leisure and hospitality had the largest decrease in employment, at 48%, and had the third-largest small business share, at 61%. Miscellaneous services had the largest small business share, at 85%, and the third-largest decrease in employment, at 22%.
- Black and Asian business owners suffered the most business closures with a 37.6% decline and a 37.1% decline respectively.
- Industries that saw the highest number of closures during the pandemic include: taxi and limousine services (-73%), niche schools and educational support services (-48%), specialized design services (-37), child care services (-37%), and restaurants (-31%).
Click here to read the full Issue Brief.