Many small businesses, both local and national, have not survived the COVID-19 pandemic, and since the initial shutdown in March 2020, Americans have worried about the pandemic’s impact on the economy.
Government legislation for funding small businesses, such as the CARE Act earlier this year, have helped those businesses trying to recover, but how devastated would the country be if those locally-owned operations shut down?
A new study from Business.org, the research site, showed just how important small businesses are to local economies.
Defining “small businesses” as companies with less than 500 employees, 47.3 percent of American workers are employed by small businesses. As you can see in the above graphic, Pennsylvania is at 46 percent.
The study used information from the Census Bureau’s Statistics of U.S. Businesses from 2018.
The author of the article, Kylie McQuarrie, writes: “We hope the data from calculators like ours can help make a compelling case for why, if a COVID-related downturn is in our future, small businesses deserve more financial aid (or, at least, better safeguards) than they received before. Millions of employees are counting on it.”
Other findings from the study:
- The U.S. has over six million small businesses that collectively employ more than 61 million people.
- Some states rely more on small businesses for employment than others. Montana’s small businesses employ a full 67.2 percent of the state’s population, while Vermont’s small businesses employ the second-highest percentage of people per state at around 60 percent.
- In contrast, Florida’s small businesses employ just 41.1 percent of the population. Small businesses in Arizona, Georgia, and Tennessee also employ around 42 percent of their respective states’ population.
- If 5 percent of existing small businesses closed nationwide, more than three million people would be out of a job. If 10 percent closed, more than six million people would lose their jobs.