Every year since 1963, our nation has designated the month of May as National Small Business Month, and every year for nearly six decades the president has issued a proclamation announcing National Small Business Week in towns across America during the month of May. This year —arguably the most devastating year for America’s small businesses in a century — the Small Business Administration is postponing National Small Business Week. New dates are to be determined.
Really? Isn’t this the year that small businesses need as much help as they can get? Small Business Week shouldn’t be postponed, it should be extended. Supporting and celebrating small businesses has never been more urgent.
The government’s response to help small businesses weather the economic fallout from COVID-19, while needed, has exposed great inequities in our financial system. The system has always benefited the biggest, most powerful businesses, and the assistance Congress has offered to small businesses through Paycheck Protection Program (PPP) loans follows that pattern. Despite allocating $670 billion to small businesses over the last several weeks, our most vulnerable business owners are being left behind. Many will never recover.
The initial PPP fund ran dry in 12 days, with just 1.6 million of the nation’s 30 million small businesses receiving loans. The second round, approved last week, is also going quickly.
I’m talking about the family-run businesses that not only provide income to one family, but also create generational wealth and economic mobility. Think about the Thai restaurant run by a husband-and-wife team whose famous green curry put their kids through college; the pet care service run by someone who knows their purpose and found a way to make a living doing it; and the 50-something secretary who launched a booming empanada business after being laid off from her office job.
It’s not just about consumer convenience and alternatives to chains and mass production. These small business owners are America. We are leaving them behind at a time when our communities need their ingenuity and hard work the most. Small businesses are the lifeblood of our economy. Businesses that have fewer than 500 employees employ nearly 50% of all private sector workers, and small businesses generate the majority of jobs in the country. It was small businesses that pulled our sputtering economy out of the Great Recession by creating two-thirds of all new jobs. With the right kind of support, they could do the same thing after the Great Lockdown.
For that, we need to do better to get real small businesses — the ones that make up the heart and soul of our communities — targeted relief. So far, that has not happened.
The problem is not just that the first round of PPP money ran dry so quickly, it’s that most small businesses couldn’t even apply for a loan. Many small business owners, and certainly the majority of minority, immigrant and women business owners, simply don’t have the banking relationships needed to expedite the loan application process. Many didn’t have a relationship with an SBA-approved bank; they had a hard time documenting payroll; they are undocumented, despite being taxpayers; or they just didn’t have accountants and lawyers to speed their application through the process. Small minority-owned businesses were at the end of the line for PPP loans — or not in the line at all. While the SBA is trying to alleviate some of these issues with the current round of small business funding, it is still plagued with problems.
It’s clear the most recent relief package Congress passed won’t be the last. Washington has to do better in the coming rounds. While lawmakers hash it out, we can help lift up our hometown businesses: Order takeout from your favorite restaurants, continue your gym membership with online workouts, maintain payments to gardeners, buy gift cards, and donate to grassroots organizations like Opportunity Fund’s Small Business Relief Fund. Working around the clock, Opportunity Fund has the scale and efficiency to help small businesses survive.
Just because the government pressed the pause button on National Small Business Week doesn’t mean America has to. This Small Business Week, for the entire month of May and beyond, let’s rally around our small business community. It’s time to show our entrepreneurs some love and appreciation for the jobs they create, the families they support, the services they provide and the character they give our communities.
Sara Gaviser Leslie is the owner of the marketing firm In Other Words and a board member of the San Jose-based Community Development Financial Institution Opportunity Fund. She lives in Menlo Park.