Where are the payroll loans? Small businesses in NJ desperate for more
A survey from The National Federation of Independent Businesses says COVID-19 continues to have a detrimental effect on small businesses in New Jersey and around the country.
NFIB State Director Eileen Kean said 90% of small businesses around the country have spent their entire Paycheck Protection Program loans and are ready to apply for loan forgiveness.
In New Jersey, small businesses need relief from unemployment insurance, which is expected to face an almost $1 billion deficit. That would automatically trigger all small businesses in New Jersey to pay into that fund. However, the state Legislature is working on legislation that would phase in those increases.
She said federal relief through The Cares ACT is the answer to help small businesses stay afloat. Other states have applied their Cares ACT money to replenish their UI funds but New Jersey has not done that.
Kean said nothing has been done to offer businesses virus-related liability protection against lawsuits or claims by employees or customers.
If eligible, 75% of small businesses would apply for a second PPP loan, according to the survey, and 52% of owners anticipate needing additional financial support over the next 12 months. Kean said it could be argued that the numbers are higher than that in New Jersey because there are certain states where businesses opened sooner.
She also said the feedback from New Jersey businesses regarding their struggles to stay open during COVID-19 has been terrible. In fact, Kean said she received a gut-wrenching phone call about a gym in the Garden State closing. The business had panned to capitalize on climbing becoming a new U.S. Olympic team sport until the pandemic dashed their hopes. Kean said the owner has had to file for bankruptcy.
Kean said that without businesses, the state won't be able to collect taxes from them.
"The economy continues to crash if we can't keep our businesses open," she said.