(Reuters) - Three-quarters of U.S. small businesses sought assistance through the Payroll Protection Program in a sign of the widespread financial distress caused by the coronavirus pandemic, but fewer than 40% had received help by early May, the Census Bureau said on Thursday.
While the PPP has been the most popular assistance program pursued by small businesses, a survey conducted between April 26 and May 2 showed that nearly 83% of small-business owners sought assistance from either a governmental body, bank, friend, family member or from their own personal resources. Just 17.3% said they had sought no help at all since the outbreak forced millions of small businesses across the United States to suspend operations starting in March.
The bureau’s survey of more than 90,000 businesses employing fewer than 500 workers each is among the first measures of the breadth of interest in an emergency program that has approved more than 4.3 million forgivable loans totaling about $540 billion since mid-April. It said it plans to conduct the survey weekly through late June, aiming to canvass around 1 million small businesses in that time.
The PPP, rolled out as part of nearly $3 trillion in coronavirus crisis relief funds appropriated by Congress so far, saw such enormous demand that the original $349 billion set aside for it was allocated in less than two weeks.
A second round, totaling $310 billion, had authorized another $192.6 billion through Wednesday, according to the Small Business Administration, which is administering it. Roughly $120 billion remains available.
Hotels and restaurants, hit hard by closures and social distancing measures, were the most likely to have sought help, with 84.5% of respondents in that sector saying they had sought a PPP loan. The loans are designed to cover key business operating costs - especially payroll - and will be forgiven if an employer has kept its workers after eight weeks. More than eight of 10 businesses in the manufacturing, health services and education sectors also asked for a PPP loan.
Fewer than 50% of businesses in the financial services and utilities sectors requested assistance, which were the two sectors with the fewest respondents saying their business had suffered a “large negative effect” during the crisis, the survey showed.
Through the end of the survey period, 38.1% of respondents said they had not received the assistance they sought under the PPP. Some 53.6% had no assistance at all under any of the federal relief programs so far, although that figure includes those who never sought it.
In addition to the findings on the relief programs, the survey found that more than 35% of small businesses had missed either a loan payment or other payment since the onset of the crisis. More than 30% reported having two weeks or less of available cash on hand to fund their business, the survey found.
Reporting by Dan Burns; Editing by Leslie Adler