A Federal Reserve survey released yesterday found that the vast majority of U.S. small businesses took a hit to their revenue last year because of the coronavirus pandemic, with minority-owned businesses struggling the most and worrying more about accessing credit, Reuters reported. The survey, which was conducted in September and October — after the first two rounds of the Paycheck Protection Program (PPP) had closed to new applicants and before Congress had finalized a nearly $900 billion aid package — showed many small businesses worried they would not survive without government help. Of the nearly 10,000 small businesses surveyed by the Fed, 95% said their business was impacted by the pandemic. Some 78% reported a decline in revenue and 46% said they had to shrink their staff. Nearly 90% of small businesses said sales had not returned to pre-pandemic levels by the time of the survey. Of those companies, about a third said it would be unlikely that the business would survive until sales recovered without more government help. Some 53% of businesses expected their total sales revenue to drop by more than 25% in 2020. Outcomes varied widely by race and ethnicity. Some 54% of white-owned firms described their financial condition as “fair” or “poor.” But that share rose to 79% for Asian-owned businesses, to 77% for Black-owned firms and to 66% for Hispanic-owned businesses. The U.S. central bank heard from 9,693 businesses across the country with fewer than 500 employees. Its Small Business Credit Survey summarized findings from businesses that were operating or temporarily closed, but did not include companies that had permanently shut down.
