About 800 small businesses – defined by the Small Business Administration as having no more than 1,500 workers or less, depending on the sector – have gone bankrupt from mid-February through 31 July. The American Bankruptcy Institute expects the 2020 total could be up 36 percent from last year.
The number of businesses permanently shutting down, bankrupt or not, is orders of magnitude higher.
Of the 80,000 businesses closed from 1 March through 25 July, 60,000 had five locations or fewer, according to Yelp, the online review site.
About 58 percent of small business owners fear their businesses will not survive the current crisis, according to a U.S. Chamber of Commerce survey.
Before the economic shutdown, the U.S. was home to about 28 million small businesses, which made up 99.7 percent of American businesses and accounted for roughly 44 percent of the nation’s economic activity, according to the Small Business Administration.
TRENDPOST: As Gerald Celente says, “Opportunity misses those who view the world through the eyes of their profession.” While this section of the Trend Journal is financially-focused, the socioeconomic and geopolitical ramifications of a shrinking middle class and devastation to small businesses must be taken in full context to access the emerging trends.
We are most concerned that violence – which has already escalated across the nation and around much of the world – will become the New ABnormal if measures are not taken by the public and private sectors to better balance the income divide.
