New Survey Data Shows That PPP Loans and Long-Term Relief for New York City Small Businesses Still Needed
Survey conducted by the Goldman Sachs 10,000 Small Businesses Voices community, which includes small business owners in New York City
February 22, 2021 — [NEW YORK, NY] – Today, the Goldman Sachs 10,000 Small Businesses Voices (10KSBV) community announced new national survey data showing that the first round of PPP helped the vast majority of small businesses stay open, but more support is needed to help small businesses recover and grow. The survey data comes as small business owners in New York and across the country are calling on Congress and the Administration to pass another relief package and enact a long-term recovery agenda that puts small businesses front and center. To read the full survey, please click here.
“The strength of small businesses will help us measure the success of the economic recovery,” said Jessica Johnson-Cope, president and principal of Johnson Security Bureau, Inc. in New York, and Chair of the 10KSBV National Leadership Council. “Congress took an important step towards relief in December but must tackle the unfinished business of supporting the entrepreneurs who drive our economy.”
The survey found that the vast majority of qualified small businesses applied for round two of the Payment Protection Program, a federal loan program to help businesses keep their workforce employed during the COVID-19 crisis. At a national level, 66% of small businesses qualify for a second PPP loan and 83% of those who qualify have applied for a second PPP loan. In the northeast, 69% of small businesses qualify for a second PPP loan and 86% of those who qualify have applied for a second PPP loan.
Despite help from the second round of PPP, small businesses still need long-term solutions to survive. 88% of respondents and 89% of northeastern business owners say the second PPP loan is absolutely vital or very important to help their business survive. However, 67% of loan recipients expect to exhaust their funding by April or May, including 68% of northeastern small businesses. Only 11% of respondents and business owners are very confident they will be able to maintain payroll if no further government relief is provided. On a personal level, 50% of small business owners have dipped into their personal savings since the pandemic started, including 49% in the northeast.
“Small businesses like ours are the backbones of our communities and our economy,” said Suzanne Wernevi, owner of Luna & Stella fine jewelry in Rhode Island, a member of the 10KSBV community. “After a year of tremendous uncertainty, it’s time to invest in small businesses and put us on the path to recovery.”
The survey also specifically assessed the importance of access to long-term capital and affordable health care. When asked about access to a line of credit or loan for their business from a financial institution 54% were very confident they could access one pre-pandemic but only 30% are very confident they can access one today. When asked about the costs of health care, 79% of those who provide health insurance say their employer costs have increased in the past year and 94% of small business owners say it is important for Congress to prioritize lowering health insurance costs for small businesses.
The survey data showed that Black small business owners continue to face an uneven recovery compared with the overall small business population. For example, 73% of eligible Black business owners have applied for a second PPP loan, which is 10% lower than the overall application rate. 42% of Black owned businesses who have applied for a second PPP loan have been approved and received loan funding compared with 54% of the overall population. Most striking is that only 16% of Black business owners are very confident they would be able to access a line of credit or loan for their business from a financial institution. In contrast, 30% of the overall small business population believes they could access credit or a loan.
The survey of 1,293 Goldman Sachs 10,000 Small Businesses participants, including 437 from the northeast, was conducted by Babson College and David Binder Research from February 15-16. The survey included small business owners from 46 U.S. states and three U.S. territories, 54% of whom were women. To read the full survey, please click here.
In January, over 2,000 small business owners from the 10KSBV community from 50 states and the District of Columbia participated in a Virtual Hill Day, meeting with their federal representatives to advocate for additional federal pandemic relief to keep America’s small businesses strong. Small business owners called for Congress to protect small businesses from potential COVID-related litigation, lower health care costs, increase access to affordable child care, simplify the government request for Proposal (RFP) process for small businesses, incentivize large businesses to use more small businesses as vendors, and help off-set reopening costs. To read the full Goldman Sachs 10,000 Small Businesses Voices Small Business Agenda, please click here.
ABOUT 10,000 SMALL BUSINESSES VOICES
Goldman Sachs 10,000 Small Businesses Voices is an initiative for program participants to organize and advocate for policies that matter to them. It builds on Goldman Sachs 10,000 Small Businesses, which over the past decade has provided access to education, capital, and support services to more than 10,000 small business owners across all 50 states, Puerto Rico, and Washington D.C.