Small Business Majority Releases New Survey Data and Calls on Congress to Act Now on the American Rescue Plan
New survey reveals 3 in 10 small businesses, 36% of Black and Latino-owned businesses face closure in the next few months without additional stimulus funding
(Washington, DC) — As the U.S. House of Representatives prepares to vote on the American Rescue Plan today, Small Business Majority released a new network survey that reveals the challenges small businesses continue to face a year into this crisis, and called on Congress to quickly pass a robust stimulus package that includes grants for small businesses.
Without quick action from Congress, 30% of small businesses in Small Business Majority’s network, including 36% of Black and Latino-owned small businesses, fear they will be forced to close their doors for good in the next three months.
The survey also explores how many small businesses accessed the Paycheck Protection Program (PPP) during the first rounds of funding. The survey finds that while PPP has been helpful to some, there are still significant gaps that remain, with 36% of loan recipients reporting they were underfunded. This underscores additional recent data from Small Business Majority that found business owners of color were less likely to have a business banking relationship pre-pandemic, and few have received funding from PPP. It should come as no surprise then that most small businesses (91%) say Congress should pass legislation to provide direct grants to small businesses.
“As these survey results make clear, PPP was a lifeline for many small businesses during the early months of the pandemic, but we must now look beyond this program to bolster our economic recovery,” said John Arensmeyer, Founder and CEO of Small Business Majority. “The American Rescue Plan is an important step, and we’re particularly supportive of provisions to allocate $15 billion for small business grants to provide more flexible and equitable financial relief and $10 billion for low-interest small business loans, among other targeted measures. These funds will help ease the ongoing economic crisis facing our nation’s entrepreneurs, and the House of Representatives must pass this legislation today. A wave of permanent small business closures is on the horizon if Congress does not act swiftly.”
Additional findings from the survey include the following:
- Three in 10 say PPP was helpful, but less restrictive capital is needed to support their businesses, and 15% say PPP was not helpful for their business.
- More than 3 in 4 (76%) have applied for PPP, but more than 1 in 3 of those (36%) did not receive the full loan amount they requested—including nearly all of the Black self-employed entrepreneurs surveyed.
- Half (49%) say the amount of PPP they qualified for was low because their business doesn’t have a lot of employees or because of how their business is organized.
- Roughly 1 in 10 were told there were issues with their credit when they applied, even though credit requirements were waived for the program.
- Only 1 in 3 of those who applied for an Economic Injury Disaster Loan (EIDL) advance grant received the full $10,000 available, and nearly 1 in 4 received just $1,000.
About Small Business Majority
Small Business Majority is a national small business organization that empowers America's diverse entrepreneurs to build a thriving and equitable economy. We engage our network of more than 80,000 small businesses and 1,000 business and community organizations to advocate for public policy solutions and deliver resources to entrepreneurs that promote equitable small business growth. Our deep connections with the small business community along with our scientific research enable us to educate the public about key issues impacting America’s entrepreneurs, with a special focus on advancing the smallest businesses and those facing systemic inequalities. Learn more about us on our website and follow us on Twitter, Facebook and Instagram.