Business
Pandemic Besieged Small Businesses Struggle to Reopen Across All Major Metros in California, But Vaccine Rollout Brightens Outlook
Small Business Revenues Scorched, Leisure and Hospitality Businesses Hit Hardest; Job Recovery Underway In Urban Centers
The number of ‘open’ small businesses in five of California’s largest metropolitan areas remains far below pre-pandemic levels – and has declined precipitously just since the surge in new COVID-19 cases hit the nation in late 2020, according to a new analysis released today by Beacon Economics.
As of early February, San Francisco has fared the worst with a 50.5% decline in the number of small businesses that are open and operating in the region compared to one year ago. Los Angeles has fared best with 34% fewer open small businesses, followed by San Diego (36.7%), the East Bay (37.2%), and the South Bay (40.3%). With the exception of Los Angeles, all metro regions performed worse than the state or nation as a whole where open small businesses have declined 35.4% and 34.2%, respectively.
In each region, steep drops in the number of open small businesses have occurred just since November when strict, health-mandated closures and restrictions were once again implemented following the largest surge in new COVID cases in the state to date.
“These latest findings underscore just how badly small businesses, and their ability to operate, have been curtailed by the pandemic and the ongoing restrictions on activity,” said Taner Osman, Research Manager at Beacon Economics. “However, with several effective vaccines rolling out in earnest, and with new virus cases falling across the state and nation, the outlook for small business is much brighter for the coming year.”
Osman notes that these data do not suggest that businesses that are not open have closed permanently, but the longer they remain closed, the greater the likelihood of that occurring. “How this ultimately plays out for individual businesses will depend on whether they have the resources to sustain themselves until things open up widely and permanently again,” said Osman. “The good news is that a sustained reopening is drawing closer and while we may not completely return to trend this year, the economy is on the path to full recovery, bringing small business with it.”
Revenues at small businesses have also been hammered, in many cases falling by close to or more than three-quarters compared to pre-pandemic levels. Key small business findings by region include:
- San Francisco Metro (SF and San Mateo Counties): Like elsewhere, San Francisco’s Leisure and Hospitality small businesses have suffered the most from pandemic-related restrictions. Regionally, there has been a 66.7% drop in the number of open small businesses in this industry compared to pre-COVID levels. Moreover, revenues at these businesses have taken a staggering 83.4% tumble. No other industry in San Francisco has come close to this level of revenue loss.
- Los Angeles Metro (Los Angeles-Long Beach-Glendale MD): While the data is brighter than in San Francisco, the number of open Leisure and Hospitality small businesses in Los Angeles has plummeted roughly 50% compared to pre-pandemic levels. This is approximately the same as in California as a whole. The loss of revenue at small Leisure and Hospitality businesses in Los Angeles stands at 68%, not as severe as the losses in San Francisco but still highly indicative of the harsh circumstances facing this industry.
- San Diego Metro (San Diego County): San Diego’s Leisure and Hospitality small businesses also stand out as the most severely affected by the pandemic. The number of open small businesses in this beleaguered industry has fallen 47.7% compared to pre-COVID levels. This is a better outcome than in the state or nation as a whole, reflecting the relative strength of the region’s economy at the outset of the crisis. Although acute, at 66.2%, there has also been less revenue loss among San Diego’s Leisure and Hospitality businesses than in any other metro.
- South Bay (Santa Clara and San Benito Counties): Unlike every other metro, in the South Bay, small businesses in the Transportation sector have fared the worst with 47.7% fewer open compared to pre-pandemic levels. Leisure and Hospitality small businesses are not far behind, however, with 45.8% fewer open. Revenues among the latter have also been hit the hardest, by far. As of February 2021, Leisure and Hospitality small businesses in the South Bay have suffered a 72.7% drop in revenue.
- East Bay (Alameda and Contra Costa Counties): In the East Bay, Leisure and Hospitality small businesses have experienced the most severe impacts with a 59.4% drop in the number of open businesses compared to pre-pandemic levels. Only San Francisco has experienced a steeper decline. Accordingly, revenues have fallen 72% at East Bay small businesses in this industry. No other sector in the region comes close to this level of revenue loss.
The new analysis also finds that employment gains are occurring across all the state’s major metros, but each still has significantly fewer jobs compared to pre-pandemic levels – ranging from 7.3% fewer jobs in the South Bay to 10.4% fewer jobs in San Francisco. Unemployment has continued to fall across all metro areas of the state.
View the full Regional Outlooks for the East Bay, Los Angeles, San Diego, San Francisco, and the South Bay here:
Empowering Economic Growth: CALED Conference Set to Unite Industry Leaders in Ontario
CALED’s ‘Growing Local Economies from the Ground Up’ Conference is being held in Ontario at the DoubleTree by Hilton Hotel Ontario Airport on May 7-9. This event is co-hosted by the City of Ontario and San Bernardino County, with Jennifer McLain Hiramoto, CALED’s Chair of the Board and Derek Armstrong respectively representing their city and county as Co-Chairs of the event.
With over 950 members and 45 years of empowering economic developers, CALED is the largest economic development association in the country and the annual conference is the number one place to meet and connect with the boots-on-the -ground, decision makers in our communities.
The conference will include a pre-conference teaching tour, ‘Building & Paying for Development Projects’ on May 6th and then begin in full on May 7th, with a welcome session and breakouts. Overall, there will be four general assembly sessions and 18 breakout sessions, which will delve into local economic development practices and innovative tools.
In addition to compelling content, the conference will have numerous opportunities to connect with community leaders and valued peers through networking receptions, the culinary crawl, and new this year, the Tournament of Champions, where conference attendees will navigate a gauntlet of games to win the grand prize on the evening of Thursday, May 8th.
To learn more about the conference and register, visit the CALED website at www.caled.org.
Business
Strengthening Community Connections: Our Exciting New Partnership with Toyota Arena, Ontario Convention Center, and GOCAL
Contributed Content | By Chris Venhoff, Senior Vice President and Inland Empire Market Leader for Consumer and Business Banking at U.S. Bank
As the Inland Empire market leader for U.S. Bank, I’m thrilled to share some exciting news: we are proud to be the Official Bank Partner of Toyota Arena and Ontario Convention Center. This partnership represents a reflection of our deep commitment to the Inland Empire and our dedication to fostering a vibrant, thriving community.
At U.S. Bank, we believe that strong partnerships drive meaningful progress. Toyota Arena and Ontario Convention Center are at the heart of the region’s culture and economy, bringing people together for world-class entertainment, business conventions, and community events. By joining forces, we’re not only expanding our presence but also creating opportunities to engage with residents, businesses, and organizations in ways that make a lasting impact.
Through our sponsorship, we’ll support concerts, sporting events, and conventions that showcase the diversity and energy of the Inland Empire. But this is only the beginning. As our partnership evolves, we’ll work closely with Toyota Arena, Ontario Convention Center, and GOCAL to introduce community-focused programs, including financial literacy workshops and charitable giving initiatives.
This partnership is designed to bring added value to the people we serve. For our customers, we’re introducing the U.S. Bank Fast Pass Lanes, providing priority access at Toyota Arena events. Special offers, exclusive event experiences, and tailored financial solutions for businesses operating in the region are just a few of the many perks we’re excited to roll out.
Our employees are at the core of our success, and this partnership allows us to recognize their dedication. Through exclusive access to events, corporate hospitality opportunities, and community volunteer programs, our team will have new ways to engage with and celebrate the community they serve.
The Inland Empire is a dynamic, fast-growing region, and we’re committed to supporting its continued success. By investing in Toyota Arena and Ontario Convention Center, we’re helping to create and sustain jobs while driving local business growth. These venues bring in visitors, revenue, and visibility, strengthening the region’s economy.
This collaboration is about more than just sponsorship—it’s about making a difference. By working together, we can elevate not just these venues but the entire Inland Empire. At U.S. Bank, we’re committed to being a partner in progress, supporting our customers, businesses, and communities every step of the way.
Honoring Visionary Leaders Driving Innovation and Community Impact
The Spirit of the Entrepreneur Awards Gala, held at the Riverside Convention Center, celebrated the brightest entrepreneurial talent across the Inland Empire. Among the evening’s finalists was Edward Ornelas, Jr., President & CEO of the Inland Empire Regional Chamber of Commerce, who was honored in the Social Entrepreneur category for his outstanding leadership and commitment to the region.
Although Ornelas did not win, the Social Entrepreneur award went to Cesar Navarrete, President & CEO of Children’s Fund, a proud Chamber member. “Being a finalist alongside such remarkable leaders is an incredible honor,” said Ornelas. “I am especially thrilled to see Cesar, a Chamber member, recognized for the transformative work he’s doing to improve the lives of children in our community. It’s a proud moment for us all.”
Another highlight of the evening was the recognition of Hilda Kennedy, President & Founder of AMPAC Business Capital, another Chamber member, who was awarded the Top Female Entrepreneur category. Hilda’s leadership at AMPAC, a mission-driven business lender, has been instrumental in empowering small businesses and fostering economic growth across the region.
“It’s amazing to see leaders like Hilda and Cesar being celebrated for their contributions,” added Ornelas. “Their achievements underscore the talent and dedication of entrepreneurs in our Chamber and across the Inland Empire. They are setting the standard for excellence and impact in their fields.”
The evening also featured the prestigious “Best of the Best” Award, sponsored by Best Best & Krieger LLP, which was awarded to Mauro Gomez, Chief Growth Officer of Anita’s Mexican Foods Corp.. Based in San Bernardino, Anita’s Mexican Foods has grown from modest beginnings into a leader in the food production industry under Gomez’s strategic direction.
The Spirit of the Entrepreneur Awards Gala continues to shine a spotlight on the transformative work of Inland Empire entrepreneurs, celebrating their innovation, resilience, and commitment to the community.
For more information about the Spirit of the Entrepreneur Awards, visit https://www.spiritawardsie.com.
For more details about the Inland Empire Regional Chamber of Commerce and its members, visit www.iechamber.org.
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