As New York emerges from one of the biggest health and economic crises in decades, swaths of businesses in the state face a long and arduous road to recovery. The impact of the closures is even more dire for small businesses like bistros, bars and restaurants that are encoded in NYC’s DNA.
What many hoped would be a temporary lock down at the onset of the pandemic has become more permanent resulting in a slower economic reopening. This has had a devastating impact on small businesses, many of whom were forced to shut their doors forever. As companies’ financial cushions wear thin, the virus threatens to upend an industry that creates 3 million jobs a year.
The Effect On Businesses
The pandemic created turmoil in the financial markets that soon spilled over to the real economy- pushing businesses in New York to the brink of collapse. Restaurants, hardware stores and dry cleaners that made up the backbone of the state hit a downward spiral as the pandemic took its toll on the nation.
After pillars of the economy buckled, many small businesses were unable to grapple with the corona-induced losses resulting in nearly 2,800 permanent business closures since the start of March. 520,000 employees were also furloughed or let go during this time.
Businesses like bookstores and bodegas that give New York neighborhoods their unique vibe, earn a majority of their revenue from in-store sales. When the lock down brought an end to this in-person interaction, many were unable to shift their business model to the virtual world and had to shut their doors.
As we approach a new normal, the recovery of many businesses after months of missed rent payments and arrears remains in question.
The Economic Impact
New York is a major business hub with numerous Fortune 500 companies and small businesses calling this place home. As a state that thrives on tourism and revenue from its commercial strips, the pandemic served as a death-knell for an otherwise booming economy.
The demise of high-end stores on the Upper West Side and beloved mom-and-pop shops created a domino effect that reverberated throughout the economy. The fiscal turmoil brought new-found urgency upon the city officials and governments to find ways to keep businesses afloat.