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Tuesday, August 11, 2020

Coronavirus pandemic has eliminated almost half of Black small businesses

Black-owned businesses take a huge hit forcing closures amid the coronavirus pandemic.

The coronavirus pandemic continues to disproportionately impact Black communities. Reports show since COVID-19 shut down the economy, Black entrepreneurs suffered the most.

READ MORE : Harlem’s small Black businesses struggle amid pandemic

According to Forbes, almost half of small operating Black-owned businesses had been forced to shut down by the end of April. The report continues to detail how Black-owned businesses were more than twice as likely to shutter as their white counterparts.

Black business theGrio.com
James Robinson works in Black-owned business,The Formalwear store, on Blackout Day 2020 on July 07, 2020 in Miami Gardens, Florida. (Photo by Joe Raedle/Getty Images)

Forbes reports, “Nationally representative data on small businesses indicate that the number of active business owners fell by 22% from February to April 2020—the largest drop on record.”

The report continues, “Black businesses experienced the most acute decline, with a 41% drop. Latinx business owners fell by 32% and Asian business owners dropped by 26%.” White businesses only fell by 17%.

This data collected by the New York Fed show how COVID-19 hitting Black and Brown communities harder translates to business failure and how the lack of government assistance only amplified the downfall.

“Volumes of COVID-19 cases coincide with Black-owned business locations: two-thirds of counties with high levels of Black business activity pre-COVID-19 are in the top 50 COVID-affected areas,” the New York Fed said according to Forbes.

READ MORE: Netflix to spend $100M to help Black business

Black Business in Harlem theGrio.com
Kings Barber Shop Unisesx in Harlem (Photo by Spencer Platt/Getty Images)

Results continue to find the Paycheck Protection Program  or PPP loans, “reached only 20% of eligible firms in states with the highest densities of Black-owned firms, and in counties with the densest Black-owned business activity, coverage rates were typically lower than 20%.

theGrio reports PPP money was received by Chinese companies, businesses owned by West Virginia governor, billionaire Jim Justice, and even rapper Kanye West‘s Yeezy brand.

Despite the financial hardship, Black-owned brands who have managed to stay afloat during the coronavirus pandemic have also seen an outpour of support. According to theGrio journalist Biba Adams, “since, May 25, the date that George Floyd was killed by police in Minneapolis, searches for Black-owned businesses increased by 1785%.”

Celebrities such as Beyoncé have also launched funds to support Black-owned businesses hit hard by COVID-19 economic fallout.

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The post Coronavirus pandemic has eliminated almost half of Black small businesses appeared first on TheGrio.



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