New report shows 59% of La. small businesses in danger of closing due to COVID-19 effects
BATON ROUGE, La. (WAFB) - A new report reveals nearly 31% of small businesses in Louisiana that responded to a survey are at risk of closing permanently over the next two months as a result of the effects of closures during the COVID-19 pandemic.
The report added nearly 60% of small businesses that responded to the survey could close over the next five months.
The report was published by Main Street America, a program of the National Trust for Historic Preservation. Officials believe the results of the survey offer insight into the need for additional federal support to small businesses.
According to the report, 58% of Louisianans employed by small businesses may face unemployment.
Nationwide, nearly 66% of small businesses face permanent closure in the next five months with more than 72% of workers facing unemployment, according to reports.
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“These small businesses, the owners and employees, are the lifeblood of Louisiana’s Main Street communities," said Lieutenant Governor Billy Nungesser. Small business owners can only cut so much before the losses in revenue start drastically impacting their ability to remain open and serve the people of Louisiana. It’s imperative we call on Congress to address critical voids in the CARES Act to fund those organizations that provide the technical assistance our small businesses will need to get back on their feet once the economy reopens. Programs like the Main Street America and the Louisiana Main Street Network will be needed now more than ever.”
Findings from business respondents in Louisiana Main Street districts to the Main Street America’s Small Business Survey show:
- 70.9% are locally-owned
- 46.2% have been in business more than 10 years
- 81% have suspended storefront operations
- 62% do not have an online sales component to produce a revenue stream
- 69.2% report a loss in revenue of more than 50%
- 61.5% report a loss in revenue of more than 75%
- 49.6% are concerned with how they will pay this month’s rent/mortgage
- 30.8% are at risk of closing within three months
- 59% are at risk of closing within five months
“The City of Denham Springs Main Street is facing devastation," said Donna Jennings, director of the city of Denham Springs Main Street. “Our two restaurants closed because there wasn’t enough takeout business. They survive on the visitors that shop to stop and eat. We are hoping they will reopen. Some shops are saying they can’t pay their rent and some shop-owners depend on their income to totally support their family.”
According to the report, nearly 6,000 small business owners responded to the survey. It added 91% of those businesses have a staff of fewer than 20 people.
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