Pandemic Challenges Continue for NYC Small Businesses

This article was written by Sarah Walsh, a summer intern of the Neighborhood Entrepreneur Law Project.

As the COVID-19 pandemic plagued the world, the U.S. shut down and businesses were forced to close their doors. No one anticipated just how devastating the pandemic would be for our city’s 240,000 small businesses, which were hit harder than many larger establishments. As the pandemic continues to unfold, “small business closures across the U.S. and the world are creeping back toward their pandemic peaks.” New York Fed economists estimate that “each additional week of being closed reduces the probability that a business reopens by 2 percentage points,” and the New York Times fears that a third of New York’s small businesses may be gone forever.

When the pandemic appeared to plateau towards the end of 2020, some entrepreneurs had the opportunity to reopen their doors with the necessary safety precautions in place. Restaurants built outdoor dining facilities, bike shops had dozens of customers lined up at the door, and small retail stores moved their businesses online. Some of these creative alternatives only offered temporary solutions. As we rounded the corner in the summer, safety requirements and mandates were slowly lifted. New York City fully reopened on July 1, meaning no more mask mandates, social distancing enforcement, or limited capacity requirements. Things had been looking up and our city seemed to be moving towards revitalizing its communities. As we think about rebuilding, it is important to recognize that small businesses continue to struggle to fully recover from this past year’s losses. A recent article by CBS News highlighted that “three out of every 10 small businesses in the U.S. say they likely won’t survive 2021 without additional government assistance during the coronavirus pandemic. Considering there are roughly 30 million small businesses in the U.S. that means 9 million small firms are at risk of closing for good this year.”

Despite ongoing challenges, hope is not lost. Throughout the pandemic and in its aftermath, the Neighborhood Entrepreneur Law Project (NELP) has continued to support and assist NYC’s small businesses. In April 2020, NELP, in partnership with the national non-profit Lawyers for Good Government (L4GG) and Kirkland & Ellis, launched the COVID-19 Small Business Remote Legal Clinic offering pro bono legal consultations to small business owners impacted by the pandemic. NELP has been fortunate in that most of our clients have been able to access and adapt to new technology, allowing our team to continue to offer both legal clinics and educational presentations remotely.

The goal of the initiative was to help microentrepreneurs understand and act upon options under the federal government’s COVID-19 stimulus package and other aid available through federal, state, and local programs. Our team continues to support small business owners in their efforts to maintain profitable businesses and help them overcome recent economic hardships through pro bono legal assistance. Additionally, NELP has developed free resources for entrepreneurs navigating pandemic recovery challenges including, “Recovery Guide: Resources and Aid for Small Businesses” and “From Pandemic to Prosperity: Innovating and Adapting as a Small Business.” This summer, the city has invited New Yorkers to celebrate their resiliency and help restore the vibrancy of our neighborhoods by supporting local businesses. We are hopeful that the ongoing creative solutions led by savvy entrepreneurs, the expansion of small business aid, and “shop small” messaging, will provide entrepreneurs with the opportunity to get back on their feet.

While the CV-19 Clinic is winding down, NELP continues to offer legal assistance to NYC’s small businesses through its online presentations and legal clinics, which provide small businesses with the opportunity to meet with a team of pro bono attorneys and have their small business related questions answered. As small businesses continue to seek creative solutions to remain open and new methods to deliver their goods and services, NELP and its volunteers remain available to help NYC-based entrepreneurs to make sure they move forward on sound legal footing.

This informational resource does not constitute, or substitute for, legal advice.