Columbia, SC (November 4, 2020)—National estimates of small business permanently closing due to the Covid-19 pandemic have been just that—estimates.
The South Carolina Small Business Chamber of Commerce (SCSBCC) sought hard data on businesses closing in 2020. In September, the SCSBCC released a report documenting how the pandemic has negatively impacted new businesses licenses. That analysis of numerous city and counties showed a 31% decline in new business licenses compared to the same time period in 2019.
Unfortunately, most South Carolina counties and cities either do not keep records on business closures or only release the information at the end of the year. However, official government data on business closures in 2020 through the first week of September was available from Rock Hill, Hilton Head and Horry County.
The data provided by the three local governments listed the name of each business that closed. Theses businesses were then assigned one of seven business sectors.
The data shows that the business sector negatively affected the most is personal services, 30.5%, which includes beauty care, fitness centers, healthcare, and financial services. The second most impacted sector is contracting, 29.7%, which includes construction, janitorial work, lawn care, repair stores, and engineering work. Retail closings represent 20.5% of the businesses lost in the pandemic.
The earlier report indicated that all three of these local governments had experienced a significant decline in new business licenses 2019 compared to 2020 during the same time period examined—Rock Hill (15.1%), Horry County (31%) and Hilton Head (35.2%).
“The small business community here in South Carolina and across the nation has been severely hurt by the ongoing pandemic-recession,” said Frank Knapp Jr., President and CEO of the SCSBCC. “Not only has the decrease in consumer demand forced many small businesses to close, but there are fewer entrepreneurs willing to take their place in this economy.”
“We need a healthy small business community to lead us out of this recession,” said Knapp. “The nation is at a 40-year low in new business startups. This recession will make it that much harder to reverse this problem. Local, state and the federal government must develop new strategies and policies for growing small businesses. Simply returning to the pre-pandemic economy will not get the job done.”