Meta released its latest report on the state of small businesses, which measured the impact of the pandemic on global small and medium-sized enterprises and highlighted how ethnic minority enterprises, especially, bear the brunt.
Meta’s small business status report series is based on an ongoing survey of nearly 24000 business leaders in 30 countries and regions, including 5324 business leaders from the United States. This scale provides an indicative snapshot of the current market – although some impacts have decreased over time, it is clear from the latest update that covid still causes significant ripples across the industry.
First, on the closure rate – meta said that despite the increase in vaccine use and the decrease in closures and closures, 20% of small and medium-sized enterprises reported that they did not operate or engage in any income generating activities in January, up from 18% in July 2021.
As can be seen from this chart, the closure rate of most states in the United States has increased.
Of the companies that remained open, 30% reported higher sales in January 2022 than in the same period last year, while 36% of small and medium-sized enterprises in the United States reported an increase in sales.
This means that most businesses still see average or below average results, although more people can go out and shop. Various restrictions still exist, so it has not been fully opened, but it is clear that we still have a way to go before we can regain momentum in the post covid environment. If we were even at that stage.
With this in mind, it is not surprising that 81% of SMEs said they had used digital tools in the past 30 days.
As you can see in this chart, 50% of SMEs worldwide report that they have been using digital tools to communicate directly with customers, which is the most common use of digital tools, while 38% of SMEs in North America say that most of their sales are digital.
The data also show that female and minority led enterprises continue to be more affected, with 44% of minority led enterprises reporting a decline in sales (compared with 30% of other small and medium-sized enterprises), while the failure rate of female led small and medium-sized enterprises is 8, one percentage point higher than that of male LED enterprises.
Such differences are part of the reason why social platforms continue to promote initiatives specifically to promote these businesses as a means to address the continuing impact and minimize the impact of racial and gender differences.
This is not always possible, but it is important to recognize these impacts in the broader context of the pandemic and to consider those affected within your own community as a result of continuous change.
In many ways, it does feel like we are returning to normal levels, but the full impact of the pandemic may last for years. In this context, we need to do our best to cooperate with local enterprises while adapting to new norms and promoting growth, whether through updated recruitment processes, new shopping behaviors, etc.
Meta’s complete 71 page small business status report includes a series of in-depth insights and notes on the continued impact of the pandemic. Given that small and medium-sized enterprises are the engine driving the overall economic development, it is worth seeing, understanding our position and considering what this may mean for your future work.