Measuring the Effect of COVID-19 on U.S. Small Minority Businesses Using Public Data from the Small Business Pulse Survey

Abstract

Since April 2020, the U.S. Census Bureau has run the Small Business Pulse Survey to measure COVID-19 impact on small employer businesses: firms with at least 1 but no more than 500 paid employees with receipts above $1,000. The most recent public data were collected in October 2021 and unfortunately do not contain information on the owners’ race and ethnicity. However, Census is adding owners’ demographic information and has so far published data up to early January 2021. This paper introduces a simple methodology to overcome the lack of public data broken down by race and ethnicity and timely assess whether COVID-19 has affected small minority-owned employer businesses more or less than their non-minority counterpart by leveraging non-demographic SBPS data as soon as they are published. The results show that minority-owned businesses did indeed suffer more from COVID-19. It is possible — but not certain — that these results underestimate the true effect of COVID-19 on minority businesses as compared to non-minority businesses