Barber shops, nail salons and other providers of personal services appear to be hardest hit, according to the Fed study, accounting for more than 100,000 establishment closures beyond historically normal levels between March 2020 and February 2021. Individual companies account for about two-thirds—or roughly 130,000—of the extra closures if historical patterns hold, according to the Fed economists, who examined businesses with employees. Other closed establishments are units of major companies—say, a Gap or Pizza Hut—that closed some locations while remaining in businesses.
Many small businesses continue to struggle to stay afloat, but the new estimate suggests that U.S. business failures have been fewer than some economists expected. One earlier study estimated that more than 400,000 small businesses had closed in the first three months of the pandemic.
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- Covid-19 toll on US businesses? 200,000 additional closures in Pandemic’s first year
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