November 23, 2020
Main Street Monday — Survey Finds Micro Businesses have been Disproportionately Affected by COVID-19
Businesses owned and operated by a single person, often called “micro-businesses” or “solo-preneurs,” are more likely to close compared to other small businesses that have at least one or more employees, says Facebook’s most recent State of Small Business Report. Facebook says that they suspect micro-businesses experienced more closures due to their higher concentration in industries that are more vulnerable to lockdowns (ie. retail and services).
Here are some of the other findings from Facebook’s survey of more than 25,000 small business leaders across 50 countries:
- A greater proportion of micro-businesses (52%) have reported a decline in sales of over 50%, relative to small businesses with more employees (48%).
- A greater number of micro-businesses have received government grants (47%) compared to small businesses with ten or more employees ( 27%). However, only 7% of micro-businesses have received government-guaranteed loans compared to 28% of small businesses with at least 1 employee.
- Female entrepreneurs have been disproportionately affected because 49% of microbusinesses are female-owned and operated, compared to only 26% of small businesses with 10 or more employees.
- Younger businesses have also been hit harder since micro-businesses are on average younger than other small businesses. 26% of micro-business survey respondents were in their first year of operation compared to only 7% of small businesses with 10 or more employees.
The State of Small Business Report is produced through the collective efforts of Facebook, the Organization for Economic Co-operation and Development (OECD), and the World Bank. The report released earlier this month is the fifth in a series that focuses on the impact of COVID-19 on small businesses utilizing Facebook’s vast collection of data. You can read the full report as well as their previous reporting here.