Impact of Covid-19 on
U.S. Small Business

by | Aug 30, 2021 | Blog

Impact of Covid-19 on U.S. Small Business

The impact of Covid-19 on U.S. small business has been particularly negative. And since they’re at the core of American economy, these effects are key indicators of the country’s financial health. We at Estafeta USA work on a daily basis with small and medium businesses as our clients and suppliers. And we can attest to their resilience in coping with the difficulty and uncertainty of the last 18 months.

In this two-part blog series, we present a panoramic view of how small business have weathered the storm. In the first part, we’ve compiled statistics from several sources summarizing the impact of Covid-19 on U.S. Small Business. And the second part lists the best practices that have allowed companies to succeed, or minimize negative impact.

The impact of Covid-19 on U.S. small business

The going certainly got tough for small business. It’s been over 18 months in this roller coaster of uncertainty and changing business conditions. Indeed, just about every survey we consulted on the topic, confirms the negative impact of Covid-19 on U.S. Small Business.
  • In a Statista.com July 2021 survey, 24% U.S. small businesses stated the COVID-19 pandemic had large negative effect on business. By contrast, only 2% said that the pandemic had a large positive effect on their business.
  • According to Forbes.com, by the end of April 2020, 22% of small businesses that existed in February 2020 had disappeared.
  • Similarly, the CBIZ Main Street Index, survey conducted by CBIZ, Inc. between Aug. 25 and Sept. 15, 2020, found that over 43% reported a significant to severe impact. The index also found the majority (84%) of businesses interviewed suffered some impact from the pandemic and corresponding economic slowdown.

The Tough bounce back: Increasing Optimism

  • According to a poll in April 21 – May 6 of this year by the U.S. Chamber of Commerce and MetLife:
    • The prevailing feeling among small business owners about their current operating or reopening strategy is of hope (44%).
    • While 31% report feeling “comfortable”, and 24% express concern, for the top three current feelings.
    • Most small businesses believe the worst is already behind, however, COVID precautions may stick around for longer.
    • Over three-quarters (76 percent) of small businesses plan to keep all COVID-19 safety precautions in place until the coronavirus pandemic ends.
    • Small businesses say that easing COVID-19 restrictions (29%) and ramping up vaccinations in their area (28%) are the two biggest keys to their success in the rest of 2021.
  • Increasing optimism was also reported by a Goldman Sachs survey in April among 10,000 in their Small Businesses program. Findings cite that 89% of small businesses were confident their business would survive.

The Tough Get Going: Lessons Learned

Although the impact of Covid-19 on U.S. Small Business has been hard, there are lessons on resilience and adaptability. Thus, our next post will share best practices from small and medium businesses that were able to come out stronger. And, we’d like to hear from you on how your business has managed during the pandemic. Please contact us and let us know, so we can share your experiences and lessons learned with our community. We’re in this together!