How Will American Small Businesses Get Back to Work?

8 min read • Apr 30, 2020 • Joe Kukura

The debate over when to reopen the US economy might be failing to take a big factor into account—people might not come out and spend money even if businesses do reopen. The recent Vox analysis asserts that “opening up the economy won’t save the economy,” noting that the restaurant business was reeling even before stay-at-home orders went into effect, and airports and car dealerships that are still open now sure aren’t seeing much foot traffic. Buyers may be cautious and slow to return to previous shopping and spending patterns after weeks or months of COVID-19 stay-at-home orders.

Several states have already had early May reopenings, and this updated map from the New York Times lets you track which states are reopening. How we rebuild small businesses will be initially guided by the results of these individual states, in this grand unwanted experiment of resuscitating the economy while keeping COVID-19 infections as low as possible. 

The state of Texas is reopening stores, restaurants, and theaters, but limiting them to 25% capacity, according to CNN. Ohio is reopening with a “no mask, no work, no service, no exception” policy, but allowing 50% of normal capacity. Other states will take a county-by-county approach that allows large cities and smaller rural areas to handle their reopenings differently based on local considerations.

The National Retail Federation said in an open letter to President Trump that if businesses were to reopen, they would need guidelines on how to handle the following public health considerations:

  • Social distancing and hygiene
  • Personal Protective Equipment
  • Health screenings and COVID-19 testing

The ethics of reopening the economy bring up thorny issues like the tracking of smartphone locations and personal health data to the levels of acceptable mortality rates. Keeping that mortality rate as low as possible will determine how American small businesses will reopen, and here are the most important developing details to watch. 

States Are Forming Alliances to Reopen by Region

Some states still under stay-at-home orders are acting regionally and forming multi-state coalitions to reopen their states together. 

New York is teaming up with Connecticut, Delaware, Massachusetts, New Jersey, Pennsylvania, and Rhode Island to coordinate as a Northeastern region. California, Colorado Nevada, Oregon, and Washington have formed the Western States Pact.  

California Governor Gavin Newsom explained the western states’ strategy in a long-winded, run-on sentence that only a politician could speak, but effectively encapsulates the myriad risks that small businesses need to consider: 

The most important framework is our capacity to expand our testing, to appropriately address the tracing and tracking of individuals, the isolation and the quarantine of individuals using technology, and using a workforce that needs to be trained, and an infrastructure that needs to be in place in order to begin the process to transition. —Gov. Gavin Newsom

The COVID-19 Infection Rate Impacts Reopening

Everything Governor Newsom says there is quite sensible, but he leaves out the most important part. The Harvard Business Review has a similar, structured proposal for getting America back to work, which also advocates for reopening state by state. But their approach insists on meeting one major requirement first.

“The state is over the peak of the current wave,” their analysts cite as the first requirement.

The top priority should be proving that a state has lowered its rate of infection spread. Absent that evidence in your state, you should be very concerned about reopening your business.

Coronavirus Testing, Vaccines, and Protective Equipment

The whole nation is increasing the volume of its COVID-19 testing, and CNBC reports testing sites are opening at popular retail chains like CVS, Walmart, and Kroger. But those chain stores admit that testing could be slowed by “availability of supplies and lab capacity,” and a report from Harvard researchers STAT News argues that testing levels are still too low.

There is a tendency to think that a coronavirus vaccine will be the magic bullet that returns the economy to normal. That may be true. But a Nobel Prize-winning economist argues that we can slowly begin the process of getting back to normal with cautious moves that do not involve a vaccine. 

“Resources, not scientific breakthroughs, are needed to expand our capacity for virus tests,” says economist Paul Romer in a New York Times op-ed co-authored by the provost of Harvard University. “Investment in protective equipment and tests would be a far less expensive, better way to stimulate the economy than giveaways and transfers.”

Tracking and Tracing COVID-19 

Apple and Google have teamed up to create COVID-19 contact tracing technology for smartphones, hoping to “enable the use of Bluetooth technology to help governments and health agencies reduce the spread of the virus.” When someone tests positive, these companies would then use phone location data to alert anyone who’d come into contact with them. It sounds nice in their press release, but we’ll also have to wrestle with the potential for unnecessary panics and serious invasions of privacy. 

In New York, contact tracers are being hired to “conduct telephone calls with persons diagnosed with COVID-19 to complete case interviews, elicit and trace contacts exposed to COVID-19.” This step is important, and much of the country may follow suit, but these programs will be developing their medical confidentiality and digital privacy policies on the fly—maybe with unintended consequences.

Tracking and tracing will come with some other scary considerations beyond tech privacy. Medical facilities might have to be ready for surges and could find themselves even more overwhelmed by lack of equipment and staff.

Reopening Small Businesses Requires New Infrastructure 

All of the factors described above are generally considered prerequisites to reopening businesses. But even if they’re all met, there will still be risks to reopening. You’ll need to attentively take care of your customers and provide the cleanest and safest physical location possible. 

We’ve mentioned that you’ll probably need to admit fewer customers onsite and promote social distancing measures through signage or explicitly communicated policies. Some customers may refuse to comply, so anticipate that conflict. You might want to consider pivoting your business to a curbside pickup model or online delivery from a service like Instacart or Postmates.

Some of these transitions won’t be easy. Masks will obviously be required for employees and probably customers, too, but can employees really stand to wear masks for 8 hours in a row?

We may also see requirements to take customers’ temperatures before entering a store, which may be a challenge since thermometers are hard to find on some retailers’ shelves right now. 

And the single most difficult question to consider when reopening is what to do if an employee tests positive for COVID-19 and how your employees will react to this news. If you don’t have a plan for that, it may be too early for you to reopen.

Reopening your small business may not be the euphoric celebration you’d hoped for, and it will not be easy. But help is available. Another round of PPP funding is underway, so check out our guidance on preparing your PPP application. When you consider the long-range outlook for your business as we deal with the coronavirus crisis, understand that reopening your doors may involve a number of revolving doors as an unpredictable situation continues to change.

Joe Kukura

Joe Kukura is a San Francisco freelance writer whose work also appears in SF Weekly and SFist. He’s written financial advice for NerdWallet, tech industry analysis for the Daily Dot, sports content for NBC Bay Area, and good, old-fashioned clickbait for Thrillist.