As COVID-19 outbreak shuts down businesses, owners worry about how long they can survive
Governor Gretchen Whitmer on Monday issued an executive order that shut down bars, theaters, and other "places of public accomodation." It restricted restaurants to carry-out and delivery orders. Beyond the legal restrictions on business operations, many customers are choosing to stay in as public health experts urge "social distancing."
While these measures are important to prevent the spread of the novel coronavirus, they could be catastrophic for small businesses in the state, said Brian Calley, president of the Small Business Association of Michigan.
One of Calley's main concerns is the strain businesses will be under as they try to support employees who can't come into work. Small businesses, he said, often operate on thin margins and cannot afford to pay employees if they have no revenue. While many business owners want to do as much as they can to help their employees, Calley said that it isn't fair to make them function as a “social safety net."
“People can’t operate like the federal government and just print money," he said. "They actually have to have money coming in to send money out.”
The food service industry will likely be hit espeically hard by the shutdown. Paul “PJ” Ryder owns PJ’s Lager House in Detroit. St. Patrick's Day is one of the busiest, most profitable days for the Corktown bar, but he won't see any green-clad revelers this year. Ryder said he has enough money to pay his employees for the past week of work, but he's not sure how he'll cover his other bills.
“To-go business is not a natural business for us in any way shape or form," Ryder said. "It’s difficult to do and difficult to maintain the volume needed to keep a couple employees.”
Calley said one lifeline for small businesses during this unprecedented shutdown could come in the form of low-to-no interest loans from the federal Small Business Administration. Calley also called for other measures like waiving penalties and interest on late tax payments.
As lawmakers at the federal and state level discuss how to soften the economic blow of the COVID-19 outbreak, Ryder said he’s worried that help may not make its way down to small businesses like his.
“It sure seems to me that when everything goes to hell, the big boys get saved: the banks, the car companies, the people that have billions and billions of dollars. And the guys who get stepped on are small business and small business employees.”
This article was written by Stateside Production Assisstant Olive Scott.