Six months into the economic disruption of COVID-19 in the United States, Yelp has found that more than 60% of business closures that have occurred since March 1 have become permanent, CNBC reported.
Breaking down the numbers
From March 1 through Aug. 31, 163,735 businesses have changed their status to reflect closures on Yelp, one of the world's most popular online business directories. That represents a 23% increase in closures since mid-July, indicating that while the health impact of the virus may be lessening in some places, the business impact is still severe.
Of those 163,735 businesses, 97,966 of them have been marked as permanently closed — nearly 60%. That number of permanent closures is a 34% increase since mid-July.
The peak number of closures Yelp tracked was early in the pandemic when the total number was about 180,000.
The restaurant industry has been the hardest-hit during the pandemic. As of Aug. 31, 32,109 restaurants had closed, according to Yelp data. Of those closures, 61% have become permanent. Many places, even New York City, are now allowing for indoor dining services, but capacity limitations can make it difficult for some restaurants to make ends meet.
The retail industry has seen 30,374 closures, with 58% of those being permanent. That's a 10% increase in permanent closures since July.
Some places have gone through multiple rounds of lockdown restrictions, and the burden caused by those lockdowns led many business owners to determine that it was not worth trying to continue business under the new conditions.
"We did everything we were supposed to do," said Mick Larkin, owner of a karaoke club in Wichita Falls, Texas. "When [Texas Gov. Greg Abbott] shut us down again, and after I put out all that money to meet their rules, I just said, 'I can't keep doing this.'"
Impact in different locations
States that rely heavily on tourism, such as Hawaii and California, have suffered the most during the pandemic. In terms of closures per capita, Hawaii and California have been hurt the most, followed by Nevada, Arizona, and Washington state.
Large cities saw higher rates of closure than small cities and towns. Los Angeles and New York City led the way with 15,000 and 11,000 closures, respectively. Half of Los Angeles' closures are permanent, as are 63% of New York City's.