Massachusetts small businesses that are open drop 37% amid coronavirus: Report

As the coronavirus pandemic has triggered shutdowns and restrictions across the state, a staggering number of small businesses in Massachusetts have closed their doors amid plummeting revenues, according to Harvard researchers.

The number of Bay State small businesses that are open has dropped by 37% since the start of the year, the researchers at Opportunity Insights estimate on their Economic Tracker.

Total small business revenue has nosedived by 44% compared to January.

“Massachusetts is seeing the same sort of national pattern with the economic crisis hitting smaller businesses particularly hard,” Sebi Devlin-Foltz, on the Opportunity Insights’ policy team, told the Herald on Monday.

“Most people are staying home and not spending as much,” said Devlin-Foltz, adding, “There has been a lot of spending for online retailers. That’s going through the roof.”

Certain small businesses have been more hard hit than others, including restaurants.

While the total number of open small businesses has decreased by 37%, the leisure and hospitality industry has seen a 55% crash. Revenue in that industry has plunged 64%.

Reduced capacities and limited hours in restaurants are having a major impact, said National Federation of Independent Business Massachusetts State Director Christopher Carlozzi.

“These businesses need to remain open and operating,” he added. “We can’t be rolling back at this point. The financial implications would be dire… We don’t want dark storefronts on our Main Streets.”

Small business closures have been more dramatic in cities, including in Boston — where the number of open small businesses has plummeted by 44% since the start of the year. Total small business revenue in Boston has cratered by 52%.

Many restaurants have shut down across the city.

“It’s a ripple effect with people not coming into Boston on a daily basis for work, not grabbing a coffee in the morning and a salad at lunch,” Carlozzi said. “People aren’t going into the office and doing things that are associated with a normal work day.”

Downtown was pretty empty on Monday, Jon Hurst of the Retailers Association of Massachusetts said after his train ride with few people aboard.

Hurst said it’s critical to urge consumers to shop and dine locally. They need to know that they can do it safely with masking, sanitizing and social distancing, he stressed.

“We ask that consumers make a concerted effort to spend money in their local economies,” Hurst said. “Small Business Saturday was a success, but one day does not save a small business. We need to continue that line of spending into 2021.”

Another key is the federal government passing a relief package for small businesses, he added. The Paycheck Protection Program money has dried up, and businesses are dealing with higher costs because of the pandemic along with lower sales.

“We need the government to step up and deliver more of a lifeline to give them an opportunity for survival into next year,” Hurst said.

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