Most Brooklyn small biz reported year-end decline, laid off workers
Brooklyn Chamber survey: Revenue is in ‘free fall’
The great majority of small businesses in Brooklyn reported a coronavirus-related drop in revenue from December 2019 to December 2020, according to a survey released on Wednesday by the Brooklyn Chamber of Commerce.
As the city grapples with restarting its economy after nearly a year of shutdowns and restrictions, 80 percent of all responding businesses reported a decline in revenue during the year-to-year period, with 47 percent saying that the decline was more than half their annual revenue. In addition, a jarring 85 percent of businesses laid of employees.
Coupled with 33 percent of businesses reporting they are still behind on rent payments, the survival of a vital generator of jobs and revenue is at significant risk of slowing New York City’s recovery.
Minority and women-owned business enterprises were particularly impacted, with more than half reporting significant revenue losses and 25 percent losing inventory and 59 percent mentioning increased debt due to business interruptions. The results stem from 166 small businesses from various sectors and neighborhoods across Brooklyn.
“The end-of-the-year survey results confirm all that we had been tracking all along in 2020,” said Randy Peers, president and CEO of the Brooklyn Chamber of Commerce. “Small business revenue is in a free fall, 85 percent of businesses let some of their employees go, and a third of businesses still owe back rent.”
Compounding the problem, half of the small businesses that responded noted they did not receive any rent concessions.
Many took advantage of the targeted relief advanced by the federal government, with 75 percent receiving a Paycheck Protection Program (PPP) loan and over half getting an Economic Injury Disaster Loan (EIDL).
The result, however, is that businesses still need significant support in the form of additional grants, rent relief and marketing support.–>
Peers continued, “We need to urgently re-open more of our economy and access much more federal support if our small businesses are to survive in 2021.”
The Chamber’s full 2020 year end small business survey data is below:
- 80% of all businesses, and 77% of M/WBE businesses indicated an overall decline in revenue from 2019 to 2020.
- 47% of all businesses who lost revenue indicated the decline was more than half their annual revenue.
- Only 13% of businesses indicated a year over year increase in revenue; these businesses tended to be concentrated in the healthcare, construction, and consulting sectors.
Employee Head Counts
- 85% of all businesses reduced their year over year employee headcounts from 2019 to 2020.
- 33% of all businesses owe some back rent.
- 49% of all businesses did not receive any rent concessions.
- Of those businesses that did receive a concession, outright rent reductions or rent deferrals were the most common, 20% and 20% respectively.
Top Three Impacts of COVID on Businesses
1) Reduced Revenue = 80%
2) Loss of Customers = 74%
3) Increased Debt = 51%
Top Three Ways Business Model Changed
1) Reduced Hours = 59%
2) Implemented Technology Upgrades (Point of Sale and/or Website) = 33%
3) Changed or Diversified Product Mix = 26%
Financial Assistance Received
- 75% of small businesses received a Paycheck Protection Loan (PPP); There was no statistical difference in the percentage of M/WBE businesses that received PPP loans vs. all other businesses.
- 53% received an Economic Injury Disaster Loan (EIDL).
- 17% indicated they received some type of “other” financial support including unemployment insurance, friends/family funds or a personal loan.
Ongoing Business Support Needs
- Grants = 83%
- Rent Relief = 63%
- Marketing Support = 63%
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