Vice President Kamala Harris claimed in June 2021 that during the course of the COVID-19 pandemic, one-third of the country’s small businesses had closed. While it wasn’t clear whether Harris meant the businesses closed temporarily or permanently or both, PolitiFact, the Poynter Institute’s nonprofit fact-checker, found the claim to be “mostly true.”
We may never know exactly how many U.S. businesses went under as a direct result of the pandemic, but examining wage and employment data from the nation’s 500 largest counties by the number of businesses, it is possible to get an idea of where the coronavirus had the worst impact on business activity and jobs. (Here are U.S. city economies that were growing the fastest before the pandemic.)
To determine the 25 counties that lost the most businesses during the pandemic, 24/7 Wall St. reviewed data on the number of business establishments per county from the Bureau of Labor Statistics’ Quarterly Census of Employment and Wages. We ranked the 500 largest counties by establishment count based on the percentage change in the number of establishments from the third quarter of 2019 to the third quarter of 2021. Data on employment also came from the QCEW. Data on unemployment for February 2022 came from the BLS Local Area Unemployment Statistics program and is not seasonally adjusted.
Among the 25 counties that went through the biggest percentage declines in the number of local businesses during the pandemic, the median loss of establishments was 1.7% and the median decline in the number of local jobs was 6%.
Livingston County, Michigan, part of the Detroit-Warren-Dearborn metropolitan area led all counties with a 5.1% decline in the number of businesses. New York County, also known as Manhattan, led counties on the list in the percentage of jobs lost, at 11.6%. Among the 25 counties that lost the most business activity in this period of time, seven are in New York state and eight in Michigan. (These are the fastest shrinking local economies in America.)
The situation has improved somewhat since the worst days of the pandemic, prior to the development and widespread deployment of COVID-19 vaccines. According to a Harvard University-based project called the Economic Tracker, the number of small businesses in the United States increased 2.9% by January 2022 compared to January 2020, when the first confirmed case of novel coronavirus in the U.S. was detected in Washington state.
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