Female restauranteur packing takeaway meal into brown paper bag for pickup or delivery during COVID-19 pandemic
Small Business Management

Coronavirus and Small Business: Which Industries Were Most Impacted by the COVID-19 Pandemic?

Over nine weeks between April 26 and June 27, 2020, the United States Census Bureau conducted a weekly survey of small business owners to measure changes in business conditions during the early phase of the ongoing COVID-19 pandemic.

The goal of this first phase was to collect detailed information about small business-specific initiatives such as the Paycheck Protection Program, as well as data relating to current business status, location closures, changes in employment use of federal assistance programs, and expectations for future operations.

We’ve reviewed the data and created a series of fact sheets to help you understand the state of small business in the United States over the course of the pandemic.

Read our insights from phase 1 of the survey

We dove even deeper into the survey’s findings to understand which industries experienced the most significant impact. Here’s what we learned:

  1. Educational Services, Arts, Entertainment, and Recreation, Accommodation and Food Services, and Other Services were most likely to be negatively impacted
  2. Utilities and Finance and Insurance businesses were the most likely not to experience any impact.
  3. Retail Trade, and paradoxically Accommodation and Food Services were the most likely to experience a positive impact thanks to a fast recovery over the 9 week survey period.

The Pulse Survey groups industries according to NAICS codes. The survey includes responses from the following industries (click to expand for examples of businesses in each industry):

21 Mining, Quarrying, and Oil and Gas Extraction

Oil and Gas Extraction, Crude Petroleum Extraction, Support Activities for Mining, etc.

22 Utilities

Electric Power Generation, Transmission and Distribution, Natural Gas Distribution, Water, Sewage and Other Systems, etc.

23 Construction

Residential Building Construction, Residential Remodelers, Building Equipment Contractors, etc.

31-33 Manufacturing

Food Manufacturing, Fabric Mills, Wood Product Manufacturing, Printing and Related Support Activities, Chemical Manufacturing, Machine Shops, etc.

42 Wholesale Trade

Automobile Dealers, Home Furnishing Stores, Electronics and Appliance Stores, Grocery Stores, Health and Personal Care Stores, Clothing Stores, etc.

48-49 Transportation and Warehousing

General Freight Trucking, Taxi and Limousine Service, Support Activities for Road Transportation, Postal Service, Warehousing and Storage, etc.

51 Information

Software Publishers, Motion Picture and Video Industries, Wired and Wireless Telecommunications Carriers, Data Processing, Hosting, and Related Services, Libraries and Archives, etc.

52 Finance and Insurance

Commercial Banking, Consumer Lending, Insurance Carriers, Agencies, Brokerages, and Other Insurance Related Activities, etc

53 Real Estate and Rental and Leasing

Lessors of Real Estate, Office of Real Estate Agents and Brokers, Automotive Equipment Rental and Leasing, Consumer Goods Rental, etc.

54 Professional, Scientific, and Technical Services

Legal Services, Accounting, Tax Preparation, Bookkeeping, and Payroll Services, Architectural, Engineering, and Related Services, Management, Scientific, and Technical Consulting Services, Advertising, Public Relations, and Related Services, etc.

56 Administrative and Support and Waste Management and Remediation Services

Office Administrative Services, Business Support Services, Travel Arrangement and Reservation Services, Services to Buildings and Dwellings, Waste Treatment and Disposal, etc.

61 Educational Services

Elementary and Secondary Schools, Colleges, Universities, and Professional Schools, Technical and Trade Schools, etc.

62 Health Care and Social Assistance

Offices of Physicians, Offices of Dentists, Offices of Other Health Practitioners, Outpatient Care Centers, Home Health Care Services, General Medical and Surgical Hospitals, Nursing Care Facilities, Individual and Family Services, Child Day Care Services, etc.

71 Arts, Entertainment, and Recreation

Performing Arts Companies, Spectator Sports, Independent Artists, Writers, and Performers, Museums, Historical Sites, and Similar Institutions, Fitness and Recreational Sports Centers, etc.

72 Accommodation and Food Services

Traveler Accommodation, Caterers, Restaurants and Other Eating Places, etc.

81 Other Services (excluding Public Administration)

Automotive Repair and Maintenance, Personal Care Services, Drycleaning and Laundry Services, Religious Organizations, Business, Professional, Labor, Political, and Similar Organizations, etc

Industries reporting the greatest negative impact

Educational Services (NAICS 61), Arts, Entertainment, and Recreation (NAICS 71), Accommodation and Food Services (NAICS 72), and Other Services (NAICS 81) were most likely to be negatively impacted, including:

  • Overall impact: Accommodation and Food Services and Arts, Entertainment, and Recreation businesses were the most likely to experience a large or moderate negative effect, with both industries scoring over the national average of 85.5% with scores of 94.1% and 93.8% respectively. The negative impact felt by businesses in these industries remained relatively stable over the nine week survey period.
  • Decreased revenue: Educational Services and Arts, Entertainment, and Recreation (NAICS 71) businesses were the most likely to experience a decrease in revenue. Both businesses experienced some recovery of revenue over the survey period, with 84.1% of educational businesses and 80.2% of arts and entertainment businesses reporting a loss in revenue in week 1 compared to 59.7% and 53.1% reporting a decrease in week 9 of the survey period. Both industries also reported a slight increase in revenue over the course of the survey period, suggesting modest recovery.
  • Temporary closures: Compared to the national average of 28.5%, Educational Services businesses were the most likely to experience a temporary closure with 58% of businesses reporting a temporary closure, followed by Arts, Entertainment and Recreation with 56% businesses in this industry reporting a closure. Both industries experienced a steady recovery, with 72.2% of educational businesses and 70.2% of arts, entertainment and recreation businesses reporting closures in the first week of the survey period compared to 45.6% and 39.8% in the final week.
  • Decreases in employees and employee hours: Accommodation and Food Services and Educational Services were the most likely to report a decrease in paid employees, with 28.3% and 22.6% of businesses in these industries reporting a decrease over the survey period compared to the national average of 16.1%. Educational Services businesses were also the most likely to report a decrease in hours worked by paid employees.
  • Limited or no cash on hand: Accommodation and Food Services and Other Services businesses were the most likely to report having cash on hand to cover operations for 2 weeks or less, or no cash available at all. Nearly 1/3 of Accommodation and Food Services business had less than two weeks of cash on hand or no cash at all, compared to the national average of less than ⅕ of all businesses.
  • Missing loan and other payments: Accommodation and Food Services and Other Services businesses were most likely to miss loan payments, with 16.6% and 10.5% of businesses reporting missed loan payments. These industries were also the most likely to miss other payments, such as rent or utilities, with 37.5% and 27% of businesses reporting missed payments.
  • Requesting and receiving assistance: Accommodation and Food Services businesses were the most likely to request PPP, EIDL, and SBA Loan Forgiveness, with 73.7% of businesses receiving PPP, 26.6% receiving EIDL, and 16.7% receiving Loan Forgiveness—more than any other industry. Other Services were the second most likely to apply for EIDL and Loan Forgiveness, with 24.3% receiving EIDL and 7.9% receiving SBA Loan Forgiveness. Accommodation and Food Services, Arts, Entertainment and Recreation, Other Services, and Educational Services were also the most likely to request funding from banks, family and friends, self, and other sources.
  • Future expectations: Arts, Entertainment and Recreation and Educational Services have the most realistic outlook, with 72.6% and 72.1% of businesses in these industries expecting to return to normal operations in 4-6 months or longer. Accommodation and Food Services and Educational Services are the least optimistic and are the most likely to report that they never expect to return to normal operations.

View full report

Industries that experienced the least impact

Utilities, Finance and Insurance, and Professional, Scientific and Technical businesses weathered the early stages of the pandemic well compared to other industries. Utilities and Finance and Insurance businesses were the most likely to report experiencing no impact, but there was a large disparity between the two industries—nearly half of utilities businesses reported experiencing no impact, while just under 20% of finance and insurance businesses reported the same.

These industries, along with a few others that will be noted below, had the strongest scores in several areas surveyed:

  • Stable revenue: Utilities and Finance and Insurance were most likely to experience no change in revenue.
  • Temporary closures: Utilities and Manufacturing were the least likely to experience a temporary closure.
  • Changes in employees and employee hours: 93.9% of Utilities and 91.9% of Finance and Insurance businesses reported no change in the number of paid employees. Real Estate and Rental and Leasing and Professional, Scientific and Technical Services were the most likely to report no change in hours worked by paid employees.
  • Strong cash on hand: Finance and Insurance and Professional, Scientific and Technical Services had the strongest cash on hand, with 66.5% and 64.3% of businesses in these industries reporting having cash on hand to support operations for 1-3 months or longer.
  • Loan and other payments: Utilities and Finance and Insurance businesses were the least likely to miss loan and other payments, with over 95% of businesses in these industries reporting no missed payments of any kind during the survey period.
  • Requesting and receiving assistance: Utilities and Finance and Insurance businesses were least likely to request assistance, with 61.8% and 37.7% reporting that they did not apply for funding of any kind during the initial survey period. These industries were also the most likely to report not receiving funding.

View full report

Industries reporting the greatest positive impact

In our first report on the Census Bureau’s Small Business Pulse survey, we noted that things were not as dire as many feared—while over 85% of businesses reported a moderate or large negative impact, 71.5% did not experience a closure, and more than ¾ did not experience a decrease in paid employees.

Our continued analysis demonstrates that Retail Trade (NAICS 44-45), Information (NAICS 51), and paradoxically Accommodation and Food Services (NAICS 72), were the most likely to experience a positive impact based on revenue, paid employees, employee hours, and future expectations.

  • Increased revenue: With 25% of businesses reporting an increase, Retail Trade was the most likely to experience an increase in revenue. Despite being the most likely to experience a negative impact, Accommodation and Food Services were the second most likely to report increased revenue at 21% The overall increase in revenue for accommodation and food services businesses is attributable to significant recovery of revenue over the course of the survey period, with 8.4% of businesses reporting an increase in week one compared to a 30.3% increase in week nine, and does not indicate the overall loss of revenue that was experienced by nearly two thirds of businesses in this industry.
  • Increase in paid employees: Accommodation and Food Services businesses demonstrated a strong recovery were the most likely to report an increase in paid employees over the survey period, reflecting the strength and speed of their recovery—47.2% of businesses in this industry reported a decrease in paid employees in the first week of the survey period compared to just 20.9% in the final week. 7.4% reported an increase in the first week, compared to 20% reporting an increase in the ninth week. Retail Trade and Administrative and Support and Waste Management and Remediation Services were the next most likely to report an increase in paid employees, with 10.2% of businesses in these industries reporting an increase over the survey period.
  • Increase in employee hours: 20% of Accommodation and Food Services and 13.5% of Retail Trade businesses reported an increase in hours worked by paid employees. These increases strengthened over the survey period, with 23.9% of Accommodation and Food Services and 12.8% of Retail Trade businesses reporting an increase in the final week compared to 9.2% and 8.4% in the first week of the survey period.
  • Future expectations: Construction and Utilities have the most optimistic outlook, with 27.5% and 23.2% of businesses in these industries expecting to return to normal operations in three months or less.

Wrapping Up

While some industries experienced a positive effect and some were more significantly impacted than others, the negative effects of the COVID-19 pandemic are widespread. Review our detailed findings on the overall impact, revenue, cash on hand, and more in our comprehensive reports:

Between working with reduced workforces, limited cash on hand, and the expiration of federal funding programs, many businesses don’t have access to the working capital they need to manage increases in operational costs.

If you didn’t receive federal funding or have run out of PPP or EIDL funding, alternative funding is available through direct online lenders like Greenbox Capital. With easier qualification criteria, faster review and approval, and no restrictions on how your funds are used, alternative lenders can help you access the working capital you need, with loans as small as $3,000 up to $500,000.

Learn more about alternative funding

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