The package includes measures for small businesses that have been decimated by the pandemic.
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February 23, 2021 3 min read
This story originally appeared on Business Insider
Some small business leaders and owners are calling on Congress to pass the US bailout plan.
Nearly 330 – including nearly 30 executives from various chambers of commerce – have signed a letter organized by Invest in America and Small Business for America’s Future. They are calling for the package, which contains several provisions for small businesses, to be adopted.
Small Businesses for America’s Future – “a national coalition of business owners and executives working to ensure that small businesses have a voice at all levels of government” – conducted a survey of their network on Aid and Recovery from COVID-19. Of the 1,241 respondents, 69% of small business owners support the US rescue plan, and over a third said they can only operate for a few months without additional relief.
This urge for additional relief comes amid an ongoing gloomy period for small businesses. In December, the National Federation of Independent Businesses’ optimism index fell 5.5 points to 95.9. As reported by Insider’s Ben Winck, this was the lowest level since May – and lower than some economists expected.
Since January 2020, the number of small businesses opened in the US has decreased by 34.2%. A September 2020 Yelp report found that of American businesses that closed as of August 31 – a total of 163,735 – 60% will not reopen. That is 97,966 companies gone.
But the paycheck protection program has offered comfort to small businesses during the pandemic. The surprisingly upbeat May job report appeared to show the effects of the program. A July study by the Federal Reserve and MIT found that PPP loans saved between 1.4 and 3.2 million jobs.
Biden’s US bailout plan would include continuation of PPP loans, plus $ 15 billion in grants to small business employers and $ 35 billion in soft loans. For the next two, PPP loans are currently only available to companies with 20 or fewer employees.
Of the small business owners surveyed by Small Business for America’s Future, 60% said they would primarily use COVID relief funds to keep workers.
“The main roads across the country need this lifeline – and they need it now. This is the only way to prevent more businesses from closing and millions of Americans from staying in the workplace,” the letter from small business owners and executives said. “The American rescue plan fulfills the urgency of the moment and is taking the necessary steps to rescue small businesses that are struggling during these troubled times.”