Many business owners are attempting to navigate rapidly changing COVID-19 regulations and are applying to state and federal loan programs. The fortunate businesses that do receive loans face the uncertainty of knowing if they will be eligible for forgiveness or if they will be stuck with enormous debt. Some federal programs also require a relationship with a lending institution, adding an additional barrier to businesses located in low-to-moderate-income communities of color, which often lack access to capital and are at risk of ineligibility.
In Wilmington, small businesses are making hard financial decisions that may not be the best option for them.
Small businesses drive our national economy. According to a 2018 U.S. Small Business Administration report, 30.2 million small businesses employed 58.9 million individuals, or 47.5% of the working population. An April 2020 report by the National Bureau of Economic Research indicates the impact of COVID-19 on small businesses nationally has resulted in 43% of businesses being forced to temporarily close and, on average, staff reductions of 40%.
The City of Wilmington has an estimated 1,500 small businesses. In a local survey conducted by West Side Grows Together, a coalition of Wilmington’s West Side residents, businesses, churches and community groups, business owners reported on average a 60% decrease in sales revenue since stay-at-home orders took place.
Public safety measures, such as non-essential vs. essential business designations, have left many owners wondering why certain businesses can operate when others cannot. Once our state reopens, sustained social distancing practices will likely result in low attendance at events such as summer farmers markets, the Clifford Brown Jazz Festival and events at the GRAND and the Art Loop, reducing the much-needed foot traffic upon which small businesses rely. Safety and our public health are top priorities, but if we are unable to help our businesses now, we will see the end of our Wilmington small business community.