Businesses closing due to Coronavirus
Posted May 2020
News Editor
Throughout Oregon, and the rest of the United States, businesses are struggling during the Coronavirus pandemic following wide-spread stay-at-home orders; while many businesses are only temporarily closed, some may be closed forever.
The Small Business Administration (SBA) lists approximately 30 million small businesses spread throughout the US, and those small businesses provide an estimated 59 million jobs. Due to stay-at-home orders, up to half of them may be permanently closed by the end of June. In Oregon, based on a recent federal data collection, there are 320,019 small businesses. The SBA estimates that around 160,000 of those businesses will close permanently.
Local restaurants are struggling to make the amount of money needed for balancing rent, buying products, paying staff, and covering bills while only earning revenue from to-go orders. While 80 percent of approximately 155,000 service industry workers have been laid off, restaurants are struggling to pay the remaining workers. More than four percent of restaurants in Oregon have already permanently closed their doors, and another estimated six percent will be shut-down by the end of May. Even when the stay-at-home order is lifted, many restaurant owners don’t think that enough people will come. If people do come, restaurants will still have to maintain a distance between tables which means fewer people will be served.
“We are praying that people will come to restaurants when we reopen, but nobody should think that they’ll be making any money until there is a vaccine,” said the owner of ChefStable, one of the Oregon’s most prominent restaurant groups, Kurt Huffman. “We’ll have the same rent, we’ll have the same overhead, our cost of food and beverage will be the same, but we’re going to have half the seats.”
Many other businesses, both in state and nationwide, are facing permanent closure. Some businesses haven’t been labeled as essential, and so those stores have been completely closed without any way to make a profit unless they are selling products online. Some nationwide stores, such as JCPenney, are closing up to a quarter of their stores. There have been 2,210 permanent closures announced by U.S. retailers.
“It’s a battle of who’s going to survive, who’s just going to close and who’s going to need to file for bankruptcy,” stated retail stock analyst for the Center for Financial Research and Analysis Camilla Yanushevsky. “The companies that are most at risk at the ones that were already distressed before the crisis.”
