The 2021 Small Business Credit Survey (SBCS) found that 1 in 10 small employer businesses suffered losses from a natural disaster during the prior 12 months.
Most businesses with no employees other than the owner earned lower revenues in 2021 than they did before the pandemic. These nonemployer firms continued to be less likely than employer firms to seek pandemic-related financial assistance.
Seventy-five percent of employer firms tried to hire workers in 2021; close to half called the experience “very difficult.” In response, firms most often increased wages or shifted more work to existing employees.
Businesses owned by people of color faced more financial and operational challenges than their white-owned counterparts and often were less successful at obtaining the funding needed to weather the effects of the pandemic.
Revenue and employment improved for small businesses since 2020, but performance largely lags prepandemic levels. Financing approval rates continued to trend lower than in years prior to the pandemic.
Businesses with no employees other than the owner often turned to personal funds in response to financial challenges during the pandemic. These nonemployers were less likely than employer firms to seek pandemic-related emergency funding and less likely to be approved.