Current Covid Cases and Deaths
This week Time magazine predicted that a wave of bankruptcy filings for small businesses will ensure following the recovery of Covid-19. The government’s attempts to provide relief for small businesses have been unsuccessful to say the least since their guidelines allow for major corporations to take millions of dollars from the fund. The program was replenished with a $484 billion bill passed through the Senate, yet many are skeptical that small businesses will find help this second time around.
Many restaurants and retailers have reported as the most affected by the shutdowns especially in large cities where independent or boutique businesses constantly fight against rising lease prices. Other companies and industries already headed for bankruptcy, such as oil, coal, and trucking companies, are unlikely to overcome the mounting debt from lack of business and sales.
Time reported how during the Great Recession, over 160,000 businesses filed for bankruptcy between 2008 to 2010 and an estimated 170,000 went out of business. These statistics were provided by the federal court system, yet it did not specify the size of the businesses. Depending on the size and debt, businesses can file for Chapter 7, Chapter 11 or Chapter 13. Although the bankruptcy courts’ doors are closed, staff are still operating remotely to keep cases moving through. Otherwise, the alternative would be a flood of cases overwhelming the courts when the shutdown restrictions are lifted.