Industry Leaders Warn Hundreds of Businesses Won’t Survive Reopening Plan, Extended Stay-Home Order

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by Scott McClallen

 

Michigan business leaders are concerned some businesses won’t survive Michigan’s mandated closures by Gov. Gretchen Whitmer, which she extended yesterday through at least May 28.

Whitmer announced a plan to reopen the economy Thursday but provided no dates, other than for manufacturing, for when additional businesses could reopen.

Michigan Chamber President and CEO Rich Studley said the order “may be a foreclosure notice” for many small and seasonal businesses.

“You’ve got June, July, and August to make 90 percent of your revenue,” he said. “If you miss that window, you’re finished.”

For example, tourism drives much of the Upper Peninsula’s economy but is currently shuttered.

Tourism employed more than 220,00 people in 2018, the 11th largest employer in Michigan, and garnered $25.7 billion of visitor spending according to a Michigan Economic Development Corporation report.

Studley said many northern Michigan communities have few COVID-19 cases, and while business owners acknowledge the virus is a serious concern, so are their livelihoods.

Studley said his members don’t understand why Whitmer has acknowledged a falling number of COVID-19 cases, but hasn’t lifted what they call the “Stay-Closed, Stay-out-of-Work order.”

Studley said hundreds of the Chamber’s members were in serious financial trouble before the additional extension, many of which will now close permanently.

“And that’s a tragedy, and it’s largely unnecessary,” he said.

Studley said his members have pointed to a disconnect between business owners who know how to operate safely and the executive office.

“Does no one in the executive office understand or care that if I stay closed for another month, that’s it?” Studley asked, repeating member concerns. “I’m done; I’ll lose a family business that I’ve worked decades to build.”

His members aren’t alone.

The Small Business Association of Michigan released a survey this week of more than 1,300 small businesses that found one in seven Michigan small businesses weren’t confident they would survive the COVID-19 pandemic.

The survey found that:

  • Nearly 45 percent of small businesses are closed.
  • About 60 percent of businesses have had to lay off at least one employee.
  • More than 50 percent of small businesses don’t have the ability for their employees to work from home.
  • More than 70 percent of surveyed businesses have applied for the Paycheck Protection Program, and 43 percent have applied for other loans or advances.
  • About 35 percent of small businesses would need additional physical space to meet social distancing guidelines.

The Michigan Restaurant & Lodging Association (MRLA) on Friday released the Roadmap to Reopening and asked Whitmer to allow restaurants to open May 29.

MRLA President and CEO Justin Winslow said the roadmap applies guidelines from several multiple federal agencies and Whitmer’s executive orders so Michigan could join the states in the country that have reopened in some capacity.

The state-mandated business closures hammered Michigan’s restaurant industry, which estimated $1.2 billion in lost April 2020 sales and almost 250,000 furloughed or laid off workers since the outbreak.

The MRLA said between March 1 and April 16, 53 percent of Michigan restaurants temporarily closed while 2 percent closed permanently.

“Michigan Restaurants have been decimated since their forced closure on March 16,” Winslow said in a statement.

“Those that remain in business stand ready to meet or exceed the challenging, but necessary, new standard procedures that will keep their guests and team members safe. These restaurateurs are Michiganders who need to be afforded that opportunity before it is too late.”

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Scott McClallen is a staff writer covering Michigan and Minnesota for The Center Square. A graduate of Hillsdale College, his work has appeared on Forbes.com and FEE.org.

 

 

 

 

 

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