Survey: Pandemic Takes Bigger Toll on Minority Business

WASHINGTON, D.C. – A survey by Small Business Majority has found businesses owned by people of color are still being disproportionately impacted by the ongoing pandemic.

The survey found that a quarter of Black, Latino and Asian American/Pacific Islander business owners may have to permanently lay off employees in the next few months, compared to 14% of White business owners.

Nearly a third of Latino entrepreneurs – 32% – said they may close their business in the next three months, along with 29% of Black business owners, 25% of Asian American/Pacific Islander business owners and 21% of White business owners.

Many business owner have struggled with federal relief programs, as 57% of entrepreneurs – regardless of race – said the application process for the Paycheck Protection Program was difficult and just a third said they received the full loan amount they requested. 

“Those who didn’t apply largely attributed their reasons to fear over taking on debt, inability to secure a loan through their bank or thinking they were ineligible,” Small Business Majority’s report said.

“These survey responses highlight ongoing concerns surrounding outreach and communication of PPP loans and the difficulty in getting funds to small businesses in need, who may lack relationships and knowledge to quickly work through the process.”

In the survey, conducted before the most recent federal relief bill was enacted, entrepreneurs of color were more likely to “dramatically change” their business: 48% of Black owners, 41% of Asian American/Pacific Island and 40% of Latinos. Overall, 31% of respondents said they’d alter their model substantially.

Small Business Majority conducted its survey between Nov. 10 and 12, polling 500 small business owners with oversamples of 300 each of Black and Latino business owners and 150 Asian American/Pacific Islander entrepreneurs.

“Despite efforts to cautiously reopen local economies and “get back to normal” during the summer and fall months in 2020, small business owners report they have had to resort to drastic measures to keep the lights on,” the survey report said. “Of those employers who reduced their number of employees during the pandemic’s height and economic downturn through furloughs and/or layoffs, 60% report they have not restored their headcount to pre-pandemic levels.”

The full report can be read HERE.

Copyright 2022 The Business Journal, Youngstown, Ohio.