Bellingham, WA — The first county-wide survey of economic impacts from COVID-19 shows that many local businesses anticipate a sustained downturn throughout the spring and summer of 2020. The survey was conducted by the Regional Economic Partnership (REP) at the Port of Bellingham, a division of Whatcom Unified Command. Based on survey results, REP reported that:
- Businesses need direct cash transfers and grants as quickly as possible. Delays in relief are exacerbating the situation.
- Traditional tools for restoring the economy have thus far been insufficient in myriad ways.
- Loans and additional debt are not helpful to many small businesses, many of whom reported carrying a high debt load prior to the COVID-19 outbreak; however, businesses will take on more debt if it is their only option.
- More tools need to be made available to different business types and operations such as sole proprietors, agriculture, fishing, and industries that rely heavily upon contract workers.
The survey collected responses from March 16 to April 24, a time when the local COVID-19 impact was rapidly evolving. There is still uncertainty around when various business sectors will reopen, and under what conditions. Respondents said 51.6 percent of businesses were open in some manner, though hours and operations may have been adjusted, while 48.4 percent were closed. A majority – 52.9 percent – said they had already been forced to lay off workers. A quarter of respondents said they would need to lay off workers if the situation persisted for two to four more weeks. The majority of businesses also reported supply chain disruptions due to COVID-19. The hardest hit sectors include: recreation; public agencies; tourism; restaurants and bars. Approximately 450 of 765 (58.8%) respondents provided an estimate of losses incurred if the COVID-19 outbreak is resolved and business is “back to normal” by May 15, 2020. Businesses in recreation reported the highest average loss at approximately $74,000, whereas the average loss for retail was $24,000.
“After reviewing survey results, it confirms certain things that we suspected. We have a number of small businesses and those businesses are being hit very hard, and many of the programs that have been created are simply not sufficient to sustain our economy in a long-term scenario,” said Guy Occhiogrosso President/CEO of the Bellingham Regional Chamber of Commerce.
“It is important that we balance our public health needs as well as getting as many people back to work safely. Our industry sector diversity is certainly an asset for our community as different sectors have different needs and will recover at different paces,” Occhiogrosso said.
Local businesses have helped the community
Local businesses in Whatcom County have generously provided many types of services, cash donations, and in-kind donations to their employees, local response organizations, healthcare facilities and workers, as well as Whatcom Unified Command, even as their own financial security has rapidly deteriorated during the COVID-19 outbreak.
Multiple businesses reported they were providing services to clients in need for free. Other businesses confirmed they provided rent relief to tenants or have reduced rent rates. Restaurants that closed reported donating their inventories, either to a food bank or directly to laid off employees. Respondents also donated to local organizations including the Whatcom Community Foundation and Lighthouse Mission. Others have donated their own stocks of masks, gloves and other personal protective equipment (PPE) to healthcare workers. Some businesses also said they purchased or produced their own PPE to share as a resource.
Many businesses reported they were unable to provide philanthropy as they did not have enough resources for themselves or their employees, but would contribute if they were able to do so.
Economic assistance to businesses
The majority of respondents, 52 percent, applied for some sort of business assistance or economic relief. Survey authors say there are several potential reasons why more businesses have not applied for some sort of assistance. Many respondents in the service sector report being sole proprietors and therefore may not be eligible for assistance programs, or may not believe that they qualify, and thus do not apply. Some businesses may also be actively choosing to not participate in some programs because taking on more debt would not be helpful long-term.
The majority of respondents identified three options they said would be most beneficial to their business:
- Expand and streamline small business loan programs.
- Temporarily suspend or cancel the business and occupation tax (B&O tax).
- Expand unemployment eligibility.
Many small businesses wanted loan programs to be easier to navigate and for higher loan amounts. They also reported taking on more debt was not helpful to them in the long term because many were already carrying debt. According to the Regional Economic Partnership, what many of these businesses are ultimately reporting is the primary tool that will help local businesses stay alive is direct cash transfers and/or grant programs.
Survey data and limitations
The survey was developed to obtain information from Whatcom County businesses regarding the impacts of the COVID-19 outbreak and subsequent “Stay Home, Stay Healthy” orders. REP plans to use this data to inform economic recovery and resiliency strategies, as well as to apprise elected leaders and decision- makers about the status of the local economy and business.
This is not a scientific survey. While surveys do not have to be scientific in order to have valuable information, results should be interpreted within these limitations. The survey sample is not balanced in terms of sector or geography, evidenced by the fact that nearly half the responses were from the service sector. Of the businesses that included valid zip codes, approximately 400 were based in Bellingham, 65 in Ferndale, 47 in Lynden, 32 in Blaine and Birch Bay, 16 in Everson, six in Point Roberts, and five in Sumas. The full survey summary document is available here.
The REP has created industry-specific surveys for the agricultural and fishing industries. For more information about industry-specific surveys, or the Regional Economic Partnership’s COVID-19 response, visit their website.
Media Contact: Claudia Murphy, Joint Information Center
Phone: (360) 815-2701
E-mail address: WUC_JIC@co.whatcom.wa.us
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