Significant Financial Losses with Women-owned Businesses during COVID-19
The National Association of Women Business Owners (NAWBO) conducted a survey from its members early May 2020 to discover needs and understand the impacts of COVID-19.
Results of the survey found that less than half of the business owners were considered essential. The average reported revenue loss was 47%. In early April, the government attempted to respond to the needs of non-essential businesses with programs like Emergency Disaster Loan (EIDL) and the Payroll Protection Program (PPP). Twenty percent of women-owned business owners did not qualify for the Emergency Disaster Loan and 16% did not qualify for the EIDL. Between the two the PPP was more beneficial because 70% applied and half of them received their funds.
The industry that was impacted the most by COVID-19 was the service industry. Services such as fitness, construction, spa/salon/wellness experienced a 70% decrease in revenues. Brick and mortar businesses such as retail, event planning, and technology was the second industry type that experienced the second largest decrease in revenue. As women-owned businesses within NAWBO are diverse in industry they are also diverse in personal characteristics. More than 43% of members have children at home and required to take care of children during working hours. Also, some women-owned businesses structure their businesses differently. Approximately, 56% of women-owned businesses receive their paycheck through payroll and the rest choose distributions throughout the year from the business. The business owner not on payroll were affected heavily by COVID-19. Those not on payroll suffered 2x as much as those were on payroll. And several business owners not on payroll did not qualify for PPP.
The survey asked what should happen moving forward. Responses regarding reopening the country, providing more money for businesses, accessing safety equipment and getting a vaccine all got significant comments. Thirty percent of women-owned businesses wanted the country to reopen. Twenty-six percent of women-owned businesses wanted more money for microprenuers and to make the process easier and faster for PPP and EIDL programs. Ten percent of women-owned businesses wanted to return to work safely and wanted access to safety equipment.
Most of the needs of the women-owned businesses have been addressed except for the vaccine which is not in place yet. Over the summer, the government provided extensions of grants and loans funded by SBA. And as far as childcare, some schools have re-opened while others are remotely taking classes. There are significant impacts with this dilemma as well. Do you believe more can be done moving forward? Let us know in the comments.