Omicron reverses small business recovery

The general consensus around the Omicron variant of COVID-19 is that it is much more easily spread than other variants, but may be less severe. While the jury may still be out on some of the health implications, there is no denying the negative effect it is having on businesses.

According to Alignable’s January Omicron Poll 53% of U.S. small businesses and 57% of Canadian businesses were hurt as a result of the variant. The poll, which surveyed 6,218 small businesses also notes that one percent of U.S. and 4% of Canadian small businesses were forced to shut down with and are uncertain as to when they can open back up again.

Of course with businesses hurt and unable top open, revenue was reduced, reversing a recent recovery. The poll shows that in December 43% of all small businesses across the U.S. and Canada were earning as much, if not more, monthly revenue than they were earning pre-COVID. However, with the rise of omicron in January, businesses saw those numbers slow down again from 43% to 31%. According to Alignable, in the past three months, small businesses had a 16% lift from November to December but fell back again with a 12% decrease in January – largely due to the new COVID variant. Inflation, labor issues and supply chain backlogs didn’t help the situation either.

Different sectors are affected differently. For example, omicron hurt 90% of the entertainment industry and 80% of restaurants. Gyms, event planning and travel were also highly affected. These are pretty important closures considering that there are more than 30 million small businesses at any given time, so even a one percent shutdown rate means 300,000 businesses have already been temporarily (or permanently) lost due to Omicron.

Although at press time, many businesses within these jurisdictions are looking at partial and/or full opening, which will likely change the numbers to positive and boost revenue even further.

Also, 67% of small businesses said they fear the variant will hurt their recovery, which is up from December. Only about 27% were not worried at all.

Geographically, the hardest hit areas in North America were New York, New Jersey and Ontario. New Jersey led the pack with 64% of business being negatively affected, Ontario with 63% and New York with 60%. In the U.S. the top five also included Michigan at 58%, California at 57% and Illinois and Washington tying at 56%. In Canada, British Columbia was next at 50% of business being impacted and Alberta at 45%.