March 12, 2021
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One year later
Yesterday marked one year since the COVID-19 pandemic was officially declared. Here’s a quick look back on the year in small business, by the numbers:
- 11.9 million small businesses are estimated to have closed; roughly 2.3 million of those firms have employees
- Self-employed businesses decreased in number by 738,000
- Small business revenue is down 32.4%
- Employment rates are down 8.1%
On a brighter note:
- 487,577 new businesses were created
- $687 billion in Paycheck Protection Program (PPP) funding was approved
- $192.5 billion in Economic Injury Disaster Loans (EIDLs) was disbursed
- We’ve tracked nearly 700 local and community funds for SMBs
As a reminder, PPP loan applications are currently set to close on March 31. If you’re still looking for funding for your business, consider applying. A Gusto lending partner can guide you through the process.
Stay strong, SMBs!
What’s in the American Rescue Plan
On March 11, the president signed the American Rescue Plan into law. The $1.9 trillion stimulus package includes several measures to support American families, like $1,400 stimulus checks, expanded unemployment benefits through September 6, a historic bump to the child tax credit, and $160 billion for vaccines and testing.
Here’s a look at what it has in store for businesses:
- $7B more for PPP, with a focus on nonprofits and hardest-hit sectors, bringing the total PPP pool to roughly $800B
- $15B in EIDL loans, prioritized for employers with fewer than 10 employees
- $25B in grants for restaurants and bars
- $1.25B more in grants for shuttered live venues
- $175M for “community navigator” programs for underserved SMBs
- $39B for child care providers
- $350B for state and local governments
- Expanded Employee Retention Credit for new businesses through 2021
- For employees:
- Expansion of the Child Tax Credit, Earned Income Tax Credit, and the Child and Dependent Care Tax Credit
- Employees can also retroactively apply for COBRA benefits
Read our full guide to the American Rescue Plan here.
REPORT: COVID-19 and Women-Owned Businesses
Monday, March 8, marked International Women’s Day. As we celebrate women everywhere this week, we can’t leave women business owners behind. A new report shows that their story amid the pandemic has been one of compounded challenges, stunted relief, and also hope.
Gusto recently partnered with the National Association of Women Business Owners (NAWBO) to survey 1,199 female business owners across industries about their experiences during the pandemic. Here’s what we learned:
- 31% of women business owners have school-aged children at home. That means about one-third of women business owners have been managing their companies through the downturn while also parenting amidst school closures and new health risks.
- 61% of these women report that school closures have impacted their business, and 30% of such owners reported scaling back due to childcare needs.
- Only 59% of women with school-aged children reported receiving PPP loans, compared to 72% of all businesses that received PPP funding.
- Still, over half of these women (53%) hope to grow their businesses and plan to increase the number of employees this year.
Watchlist
Mar 18: What California Employers Need to Know About COVID-19 Sick Leave
The pandemic has resulted in many updates to the workplace, not least of which is paid sick leave requirements. California’s Labor Commissioner will be joining Gusto for a special event to break down new state leave regulations and help California employers stay compliant. Register here.
Mar 19: American Rescue Plan—A Full Breakdown for SMBs
Watch our team of Gusto experts break down all the small business relief programs in the American Rescue Plan, including the latest with the Paycheck Protection Program aka PPP round 2, new and updated tax credits, provisions for employees, and more. Set a reminder here.
Top relief options for the week
- Shuttered Venue Operators (SVO) Grant program includes $15 billion in grants to shuttered venues. Eligible applicants may qualify for SVO Grants equal to 45% of their gross earned revenue, up to $10 million. $2 billion is reserved for eligible applicants with up to 50 full-time employees.
- Comcast RISE Investment Fund provides monetary grants to help Black, Indigenous, and People of Color (BIPOC)-owned small businesses grow as they navigate the challenges of the pandemic. Applications are now open for $10,000 grants for businesses in a number of cities throughout the country, including Chicago and Atlanta.
- City of Pawtucket, Rhode Island is providing $5,000 loans to existing Pawtucket small businesses that have suffered severe financial hardship due to the COVID-19 pandemic. These loans have 24-month terms with no repayment for the first 12 months. These loans become forgivable after the first 12 months for qualifying businesses.
- See more relief options in our Small Business Relief Finder.
Want more small business news and resources? Check out past editions in our archive.
