Week 1: Labor Market Impacts of COVID-19 on Hourly Workers in Small- and Medium-Sized Businesses
Week 2: Update with Homebase Data Through April 11
Week 3 and 4: Update with Homebase Data Through April 25
Week 5 and 6: Update with Homebase Data Through May 9
Week 7 and 8: Update with Homebase Data Through May 23
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Read the related Appendix »
The current surge in COVID-19 cases appears to be taking a toll on small businesses and their employees.
As in previous analyses, we track the impact of the pandemic on roughly 40,000 small businesses that use Homebase, an electronic time clock and scheduling service. We will continue to update these facts, tracking patterns and adding new information as the COVID-19 situation develops. An up-to-date version of this summary will be maintained here.
Finding #1: Recovery has stalled and begun backsliding. There has been little net recovery since June. In the last few weeks, we are seeing increased layoffs again.
Figure 1 illustrates how aggregate hours have changed relative to late January at these firms. We distinguish between three sources of hours losses: firm shutdowns, layoffs, and hours cuts. At the height of the crisis, total hours at these businesses fell roughly 60 percent relative to their January baseline. The decline in total hours was due primarily to firms closing entirely and to open firms laying off some portion of their staff. Between mid-March and early April, about 40 percent of the businesses in our sample shut down entirely for at least one week.
Between the end of April and late June, firms gradually reopened and restored their employees’ hours. By July, this recovery flatlined. Since then, there has been neither a net reopening of previously closed firms nor hours growth among those that did reopen. Close to one-quarter of firms that shut down in March have never reopened, and a similar fraction of firms that did reopen have since closed again.
As COVID-19 case counts started to rise again in late October, total hours fell for several consecutive weeks, the first time this has happened since April. Shutdowns, layoffs, and hours cuts have all risen in each of the last three weeks.
FIGURE 1: Hours changes at Homebase firms each week, relative to Jan 19-Feb 1, decomposed into firm shutdowns, layoffs, and hours reductions