As thecontinues to batter U.S. small businesses, new data from tax-prep service H&R Block suggests Black-owned firms are taking the biggest hit.
An H&R Block survey of almost 3,000 small businesses found that 53% of Black business owners saw their revenue drop by half, compared to 37% of White owners, since the pandemic started. Black business owners also had more trouble establishing an online presence for their company and were more likely to have customers submit late payments, the survey said.
“Black-owned businesses play such an important role in improving local economies and uplifting communities everywhere,” H&R Block Vice President of Small Business Ian Hardman said in a statement. “Clearly there’s a grave need to support small business owners, especially those hit hardest by the pandemic.”
H&R Block’s survey is the latest in a catalog of research detailing how Black-owned businesses have struggled in the past year.
Afound that only 40% of Black business owners expected to remain open over the ensuing six months, compared with 46% of Asian respondents, 48% of Latinx owners and 55% of Whites.
The Federal Reserve Bank of New York found that small business ownership in the U.S. dropped 22% between February 2020 and April 2020, but Black ownership dropped 41% — the greatest decline among all racial groups during the depths of the pandemic.
Thousands of Black businesses have already closed for good. Part of the struggle for Black businesses stems from their difficulty securing bank loans during the first wave of the pandemic, while many report being left out of the Paycheck Protection Program, a federal lending initiative geared to smaller employers.
Data from the loan program released in December by the U.S. Small Business Administration and analyzed by the Associated Press show that many minority ownersPPP loans until near the end of the new program’s funding rounds.
Hoping to fix that issue, Presidentthis week that minority-owned businesses will be among the smaller businesses to get first dibs for two weeks on the next round of PPP funding starting March 1.
“Since the beginning of this pandemic, 400,000 small businesses have closed and millions more are hanging by a thread,” Mr. Biden said during a White House press conference on Monday. “It’s hurting Black, Latino, and Asian American communities the hardest.”
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