Many New York City Small Businesses Face Harsh Reopening Odds

Roughly a third of the small business in New York City might never reopen in the wake of the COVID-19 pandemic. A new 67-page report released Monday by the Partnership for New York City, produced in collaboration with 12 consulting firms, gave the sobering outlook on the city’s economic future and what might have to be done to help it recover.

The report stated that most of the small businesses in the city have roughly three months of cash reserves with which to stay afloat. This is roughly the same amount of time as the city was under lockdown in response to the coronavirus outbreak, putting these businesses in a troublesome spot should the economy continue to falter.

“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,” co-authors Kathryn Wylde and Natasha Avanessians said. “COVID-19 has changed the value proposition, since previous advantages such as foot traffic and easy access to the offices of clients and potential customers have diminished.”

As has been the case in most places, the report found that New York businesses in the retail, hospitality, and foodservice spheres are likely to be the most severely impacted by the pandemic.

Elsewhere, the report estimated that only 75% of office workers in the city will eventually return, with 40% expected by the end of 2020. It also found that 54% of jobs in the city could be done remotely, indicating a safer way forward for the foreseeable future.

In addition to calculating the damage done by the pandemic, the report also had several recommendations for recovery. It suggests that hotels should be converted for use as housing for the city’s poor and homeless while they are unable to conduct business. The city was also encouraged to use a system similar to its letter grading for restaurants to grade safety practices at public establishments.