Survey: Northern California service sector businesses expected to lose 50% or more of annual revenue |

Survey: Northern California service sector businesses expected to lose 50% or more of annual revenue

Sam Corey
Staff Writer

Since the COVID-19 pandemic hit, and government orders urging safety in a more cautious world began, many people have wondered how small businesses are faring.

A business recovery survey, issued between May 4-15 by the Northern Rural Training and Employment Consortium and nonprofit 3CORE, tried to shed some light on this question. Almost 600 people responded to the survey, 70% of which were business owners with 10 employees or less.

About 350 of 594 responders said they expected to close their business within the year if pandemic disruptions continued, and six had already reported closing permanently. About 80 responders said their loss of revenue was between 90% and 100%, while most responders, 159, estimated revenue losses between 25% and 49%.

Survey responders hailed from across the North State, including 66 from Nevada County, with most responders from Shasta, 116, and Tehama, 115, counties.

Industries expecting to lose 50% or more of their annual revenue are concentrated in the service sector, according to the survey, including restaurants, retail, health, human services and hospitality.

Sierra Business Council Vice President of Business Innovation Kristin York said the results of the survey match what she’s seeing in the field, including the notion that many small businesses still need help navigating the regulatory process and federal aid programs. She said this is mostly because the programs were issued very quickly.

“Public agencies (who were likely already capacity constrained) had to scramble to create programs and implementation plans for literally every sector in our economy,” she wrote in an email.

Most northern California survey responders, 385, had not made use of the Economic Injury Disaster Loans, but a large proportion, 265, had made use of Paycheck Protection Program loans.

York said these statistics made sense.

“The second round of PPP funding was much more accessible for smaller businesses and rural communities,” she wrote. “In addition, once Congress started talking about relaxing the forgiveness timeline to 24 weeks, the loan became much more attractive and more small businesses applied.”

At this point, York’s main concern for small businesses is whether they have a plan for managing cash flow, and if they are able to pivot their business models during the recovery. For those needing help, she advised calling a small business development center, which offers free assistance.

To contact Staff Writer Sam Corey, email or call 530-477-4219.

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