A recent report shows that a third of NYC’s 230,000 small businesses may never reopen.
The Partnership for New York City, with the help of 12 global consulting firms, has released a post-pandemic response plan on Monday.
“It will be far more difficult to restart and repair the economy than it was to shut it down,” the report said. The attractions that New Yorkers value most in the city—its cultural, social, and entertainment assets—will remain at least partially shuttered until next year. As many as a third of the 230,000 small businesses that populate neighborhood commercial corridors may never reopen.”
Fox Business explained that most small businesses have less than three months’ worth of cash reserves.
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“That means that funds to restart, pay back rent and buy inventory are exhausted, leaving tens of thousands of entrepreneurs at risk, particularly business owners of color,” said authors Kathryn Wylde and Natasha Avanessians.
They explained that business owners face high rents, regulatory burdens, and taxes.
“COVID-19 has changed the value proposition,” they said. It did so “since previous advantages such as foot traffic and easy access to the offices of clients and potential customers have diminished.”
“On the contrary, over the past decade, political forces have created a much more expensive and litigious environment for business that is no longer sustainable for those whose margins were narrow before the pandemic,” the authors added.