Back to Business: Are Small Businesses Rebounding from COVID-19?

Back to Business: Are Small Businesses Rebounding from COVID-19?

May 25, 2021


OVERVIEW

After more than one year of lockdowns, devastating illness, and social unrest, there are signs that across the country customers are returning, and we’re getting back to business. 

 

Yet there are gaps in understanding what small business owners are experiencing and whether this emerging recovery is evenly distributed.

 

Reimagine Main Street and its partners the US Black Chambers, Inc, the United States Hispanic Chamber of Commerce, and National ACE fielded a national survey of small business owners from April 28-May 12, 2021 to provide insights into how small businesses are faring and to understand what they expect the near future to bring.

Key Takeaways

  • Small business optimism prevails fueled by availability of vaccines, confidence in the overall trajectory of the economy, and backstopped by relief. 
  • At 77% overall, small business owners are optimistic about their own futures with Hispanic/Latin(x) business owners expressing the most confidence (87%).
  • More than three-quarters (78%) of respondents agree that vaccines make them more confident in the future of their businesses, with Native business owners expressing less confidence at 58%.
  • Two-thirds (66%) of respondents are optimistic about the current trajectory of the economy, with Black business owners expressing optimism at the highest rate (79%).
  • And while success rates for Federal relief varied widely across race and ethnicity, more than 60% of the AAPI, Black and Hispanic small businesses owners who received PPP funding reported it was critical to keep their businesses afloat. 


  • In spite of this optimism, we’re not out of the woods yet and signs of recovery are not experienced equally.
  • At least two thirds of AAPI (66%), Black (67%), and Native (75%) small business owners expect it will take at least 6 months to return to pre-pandemic revenue, with Hispanic and White business owners only slightly more optimistic. 
  • Young (<50)Hispanic men are most confident (63%) that we have turned the corner on pandemic and that business is returning to normal. By contrast, young Latinas are among the least confident (29%).
  • Across the board, women business owners are less likely than men (37% vs 45%) to think that business is returning to normal.
  • All segments of older (50+) entrepreneurs expect slower recovery than their peers with older AAPI women the least confident (26%) of all segments of business owners. 

  •  Looking ahead, addressing demand for relatively small dollar business financing and addressing bias and barriers in access to capital for entrepreneurs of color are imperative.
  • Most (64%) of small employers are confident in their ability to retain and attract the talent they need to operate and grow their businesses with Black (72%) and Hispanic (66%) small employers expressing the most confidence.
  • By contrast, business owners are not confident in their ability to access capital. Both small employers and non-employers lack confidence in their ability to access financing for working capital and growth.
  • Among very small (annual revenue <$250K) businesses, confidence in ability to access financing is especially low independent of race or ethnicity. Almost two-thirds (63%) of very small businesses are pessimistic rising to more than 70% of White and Hispanic business owners.
  • For larger businesses (annual revenue >$1M), there is a sizable confidence gap (28% spread) for entrepreneurs of color.


Methodology

The survey was conducted online from April 28-May 12, 2021 with 1,341 small employers responding, including 151 AAPI-, 434 Black-, 224 Hispanic- 49- Native-owned, and 483 White-owned small businesses.


Thank You to Our Survey Partners

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