As a small business owner, it has likely been an up and down experience for you since March of 2020. Retail, restaurants, and accommodation services were especially hit because of their inability to keep their doors open. Many businesses were able to resort to online sales or scaling back everything to save money. However, some buckled under the combined weight of losing income and clients.

With the loans and grants available from the SBA, there is hope, but there are still challenges. Let’s take a look at some of the newer statistics and governmental benefits available this new year to help your business survive and thrive during this pandemic.

Hardest Hit

According to AARP, the hardest hit industries had these unemployment rates in Dec. 2020:

  • Leisure and hospitality jobs: 16.7%
  • Support jobs for mining and oil and gas extraction:13.1%
  • Travel and transportation jobs: 8.4%
  • Construction jobs: 9.6%
  • Motion picture and music industry jobs: 6.4%
  • Laundry, dry-cleaning, other personal service jobs: 7.4%
  • Self-employed workers: 6.7%
  • Jobs manufacturing food, clothing and other goods: 5.5%

Yelp recently conducted a study and determined that 800 businesses are closing daily across the US while UC-Santa Cruz’ study estimates 1500. WCNC Charlotte uncovered that  “Yelp’s report combined what it described as permanently closed businesses and temporarily closed businesses. If you only look at permanent closures – the number goes from an average of 800 to 500 closures.” 

Restaurant Industry Statistics

About 17% of America’s restaurants have already permanently closed this year, with thousands more on the brink. YesWeekly reported in December that “Without immediate financial aid, over 75% of the North Carolina’s 19,504 eating and drinking locations are in danger of closing permanently.”

This is dangerous for our state’s economy since food services account for 8.7% of all employment in North Carolina. (1)

It is also dangerous for our tastebuds and sense of well-being. Who doesn’t enjoy a night out with a lovely dinner prepared by a local chef? In the coronavirus world, the ones who nourish our spirits and bodies are very much in a time of need. If we want to continue to have our nights out, we must continue to support our local restaurants with our visits and our appreciation shown through our orders. Even if it’s just takeout, it is worth much to our economy and to our culture in NC to keep our restaurants open and supported.

Waiting for Answers

Government sources like the Bureau of Labor Statistics aren’t giving numbers at this point and will need more time to compile. Once we can compare them to the same quarters last year, the impact of the pandemic will be seen more clearly. For now, businesses have to keep looking ahead and doing their best to stay afloat in this unprecedented time. (1)

Economic Struggles

Businesses were hit with a lack of income from their base of reliable clients who chose to cut spending and hunker down amid a potential economic crisis. Many businesses had to close doors and stop food or clothing orders. Consulting businesses and health services were also hit hard as everyone endeavoured to stay home and hold tight to their resources. 

Whether you lost the sales of merchandise or faced food spoilage, many businesses did not have the funds to make it through and reached out to the PPP program for the first draw of loans. 

Now that we are in 2021, many surviving small businesses have adapted to the ups and downs and are playing it safe with shorter open hours and less employees. However, there is more help on the way if your business needs more funds to get through the rest of the pandemic.

Second Draw PPP Loans

According to the US Small Business Association, SBA is accepting Second Draw PPP loan applications. Participating lenders are on Lender Match. You can apply January 13 through March 31, 2021. There is $25 billion available for eligible borrowers and the terms are the same as your first draw PPP loan whether you choose the same lender or not.

Second Draw PPP Loans can be used to:

  • Help fund payroll costs
  • Help fund benefits costs
  • Pay for mortgage interest
  • Pay rent and utilities
  • For worker protection costs related to COVID-19
  • For uninsured property damage costs caused by looting or vandalism during 2020
  • Certain supplier costs and expenses for operations

Calculate Your PPP Loan Amount: 

  • Most Businesses: 2.5x average monthly 2019 or 2020 payroll costs up to $2 million. 
  • Accommodation and food services businesses: 3.5x average monthly 2019 or 2020 payroll costs up to $2 million

Who Qualifies for PPP Second Draw?

A borrower is generally eligible for a Second Draw PPP Loan if the borrower: 

  • Previously received a PPP Loan and will or has used it only for authorized uses
  • Has no more than 300 employees
  • Demonstrates at least 25% reduction in gross receipts between comparable quarters in 2019 and 2020

Will I Have to Repay My PPP Loans?

PPP Loans for eligible borrowers qualify for full loan forgiveness if during the 8- to 24-week covered period following loan disbursement:

  • Employee and compensation levels are maintained
  • The loan proceeds are spent on payroll costs and other eligible expenses
  • At least 60 percent of the proceeds are spent on payroll costs

Recent legislation has eliminated the original requirement to deduct the amount of EIDL Advance you may have received from your PPP loan forgiveness. Forgiveness Application forms can be found here.

Other SBA Offerings 

  • COVID-19 Economic Injury Disaster Loans (EIDL): This loan provides economic relief to small businesses and nonprofit organizations that are currently experiencing a temporary loss of revenue. You can apply for this loan and check out the terms at EIDL.
  • Express Bridge Loans: Enables small businesses who currently have a business relationship with an SBA Express Lender to access up to $25,000 quickly.
  • SBA debt Relief (for existing borrowers): The SBA is providing a financial reprieve to small businesses during the COVID-19 pandemic.

SBA Future Offerings:

  • Shuttered Venue Operator Grants: eligible applicants may qualify for SVO Grants equal to 45% of their gross earned revenue, with the maximum amount available for a single grant award of $10 million. $2 billion is reserved for eligible applications with up to 50 full-time employees.
  • Targeted EIDL Advance (limited eligibility)

To read more about the available benefits for small businesses and apply for help, visit Small Business Association Coronavirus Relief Options.

Find Legal Help

Sometimes it is difficult to know what your accounting books are telling you. Should you take out a loan? Will it be forgiven if you do? What about unemployment benefits? How many employees can you handle right now and what are the risks to your business if you do continue to hire? What about employees who accepted fraudulent amounts of unemployment or should have never applied in the first place?

If you are struggling to find answers to these and other questions or to apply for and receive government assistance benefits, contact an experienced business lawyer who can guide you through application processes and work with you to determine what is the next step for you. If you need an experienced and knowledgeable voice guiding you through the legalities of your decision processes, give us a call and set up a time to meet virtually or face to face. We want to help you decide what is the best route for your particular situation.



  1. https://www.yesweekly.com/business/covid-19-may-wipe-out-75-of-north-carolina-s-20-000-restaurants/article_d8a7dc76-3e56-11eb-b0fa-d31b03656e0d.html
  2. https://www.sba.gov/funding-programs/loans/coronavirus-relief-options
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