More businesses were lost in the last 3 months than all of the Great Recession
The U.S. saw its largest ever decline in the number of business owners between February and April, as at least 3.3 million shut their doors, a new paper from the National Bureau of Economic Research using the Census Bureau's Current Population Survey found.
What it means: The record wave of closures was widespread but disproportionately hit minority- and immigrant-owned firms, and "may portend longer-term ramifications for job losses and economic inequality," the study found.
- African American businesses were the hardest hit.
The big picture: "No other one-, two- or even 12-month window of time has ever shown such a large change in business activity," author Robert W. Fairlie writes.
- "For comparison, from the start to end of the Great Recession the number of business owners decreased by 730,000 representing only a 5 percent reduction."
- The reduction from February to April this year is more than four times that much.
What's next: "More permanent mass closures of small businesses in the United States are likely to have a dramatic effect on employee job losses, further income inequality, and contribute to a prolonged recession."
Go deeper: A reckoning for small business