I own a cleaning company, a month ago we had 11 employees and had just started doing about $40k a month in revenue. This “stimulus” feels more like a punishment.
There are so many things wrong with how the various “stimulus” packages are currently being administered. And not just PPP.
I have spoken to hundreds of other service business owners who are also experiencing the following:
- They did not receive any amount money from anyone – loan/grants etc.
- Their employees are making more through unemployment and are not incentivized to come back to work. Unemployment is currently paying an extra $600 per work on top of whatever your pay is.
- Many of their businesses are not allowed to operate yet, though there has been no formal stopping of payment for business expenses/rent etc.
- It is unclear what the ramifications of their staff taking unemployment will mean for their unemployment rates. Cleaning is deemed “essential” however, no one in their right mind wants cleaning technicians going from home to home right now. Also we are being told by local government we are not allowed.
- Employees are able to easily collect unemployment, for business owners many of the negatives outweigh the positives… Assuming you can even get the red tape and actually even collect.
- Larger competitors ARE receiving loans and grants and are going absolutely annihilate us over the next year.
What does this mean?
I think we will see many small (0-20 employee) businesses close.
Larger companies will eat up more market share and have [almost] free uncle-sam-bucks to do it.
Wages will continue to stagnate or drop for low-skill labor-type jobs as garbage corporations and larger companies put smaller ones out of business.
To be clear I don’t think this is a function of the “stay at home order” being too strict. I think misappropriated funding is creating an environment that actively puts small business owners at a disadvantage. Our company would objectively be in a better spot had no stimulus money been paid out.
Edit: to be clear we aren’t going out of business, nor am I looking for sympathy. I’m just shedding light on the fact that this stimulus is hurting many businesses like mine because my larger competitors are receiving mountains of free cash while we are all out of commission.