Beyond the lives the coronavirus has taken, it is also exacting a huge cost on the global economy. This has led U.S. President Trump to order a $50 billion small business stimulus during his speech to the nation.
SBA Coronavirus Loan and Other Assistance
The President was urging Congress to help small businesses and deliver tax breaks. Trump specifically asked for three economic policies.
- Increase funding for the Small Business Administration (SBA) by $50 billion. This SBA coronavirus loan funding should help increase financing to regions the disease has impacted most. This is in addition to the $8.3 billion emergency funding the President signed.
- Allow deferred tax payments to inject a temporary infusion of $200 billion into the economy for certain people and businesses negatively impacted by the virus.
- Ask Congress to cut the payroll tax to put money into the economy right away.
In the speech, the President said, “Effective immediately the SBA will begin providing economic loans in affected states and territories. These low-interest loans will help small businesses overcome temporary economic disruptions caused by the virus.”
For its part, Congress is expected to vote on a funding package addressing a range of issues. The bill by the Democrats includes paid sick leave, unemployment insurance, emergency leave benefit, worker protection, food assistance, medical testing, and Medicaid money. It is expected to get a floor vote on March 12, 2020.
We will have to wait and see just how much the President will get and Congress will approve in the coming days.
In addition to the economic stimulus, President Trump also announced the ban on all inbound flights from Europe for a month except the U.K. The ban will not affect goods and cargo.
The ban will start Friday, March 13, at midnight.
The Role of the SBA
The SBA is now responding to the coronavirus like a major disaster. And just like a major disaster, the agency will help small businesses recover from their adversity by providing low-interest loans and other assistance.
If the President gets the $50 billion for the SBA, the money will go to help small businesses across many industries.
The Impact on Small Businesses
Even though the impact of the coronavirus is across the board, industries in the beverage and hospitality, travel and tourism, as well as retailers are bearing the brunt early.
Travel fears have ground the tourism industry almost to a halt. Cruise ships are being shunned as are popular destinations not only in the U.S. but around the world. Italy, which counts on tourism for 12% of its GDP, is on a nationwide lockdown. Many of the small travel agencies who count on these trips are now without destinations.
The hospitality industry, which needs crowds of people, is also suffering. There are fewer people going out to venues and events. This means restaurants, caterers, hotels, as well as all of the suppliers and service providers supporting them will be hurting.
On the other hand, food delivery service is on the rise as more people eat in. The key is to find an alternative that works for your businesses until the virus is under control, which it will be.
If there is a silver lining to this outbreak is, we now have technology that allows people to work from virtually anywhere. If your industry can manage to have its employees work remotely, by all means, do it for as long as possible.
However, not all businesses can do this. If you happen to fall into this category the best option is to keep distances between everyone including customers. Meantime make sure to clean and wipe down surfaces often with EPA-registered disinfectants.
Take a look at the CDC’s Interim Guidance for Businesses and Employers here.
Most of all make sure you and everyone that works for you are aware of the symptoms of the coronavirus. The symptoms are fever, cough and shortness of breath. If any of your employees have developed symptoms and have been in close contact with a person known to have COVID-19 call a doctor.