60% of business closures due to coronavirus now permanent: Yelp
Yelp released the Economic Impact Report which showed that almost 98,000 businesses have closed due to the coronavirus
When the coronavirus pandemic was first announced many hoped that the disruption to the U.S economy would be temporary. But this week Yelp released an Economic Impact Report that reveals more than half the business closures across the nation have ended up being permanent.
While tracking business closures Yelp also monitored how many establishments went out of business entirely. Over the last six months those figures have skyrocketed, now reaching 97,966, which represents 60% of closed businesses that won’t be reopening.
“Overall, Yelp’s data shows that business closures have continued to rise with a 34% increase in permanent closures since our last report in mid-July,” Justin Norman, Yelp’s vice president of data science, told CNBC.
The latest report assessing COVID-19’s economic toll also showed that, “As of Aug, 31, 163,735 businesses have indicated on Yelp that they have closed. That’s down from the 180,000 that closed at the very beginning of the pandemic. However, it actually shows a 23% increase in the number of closures since mid-July.”
“Despite the hard hit small businesses have certainly taken, we’ve seen that home, local, professional and automotive services have been able to withstand the effects of the pandemic better than other industries,” Norman noted.
Due to social distancing mandates, many consumers are now confined to their homes, which has meant professional services such as landscapers, contractors and lawyers, are experiencing a much lower closure rate than retail outlets. Auto and towing services have also reported a comparatively low closure rate.
“Consumers still need these services,” Norman said. “Through the rise of virtual consultations, and contactless or socially distanced services, these businesses have been particularly resilient during this time.”
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