A majority of businesses that shut down during the COVID-19 over-reaction by government officials will never reopen.
“As of Aug, 31, 163,735 businesses have indicated on Yelp that they have closed. That’s down from the 180,000 that closed at the very beginning of the pandemic. However, it actually shows a 23% increase in the number of closures since mid-July,” CNBC reports.
In addition to monitoring closed businesses, Yelp also takes into account the businesses whose closures have become permanent. That number has steadily increased throughout the past six months, now reaching 97,966, representing 60% of closed businesses that won’t be reopening.
“Overall, Yelp’s data shows that business closures have continued to rise with a 34% increase in permanent closures since our last report in mid-July,” Justin Norman, Yelp’s vice president of data science, told CNBC. … Throughout the past six months, restaurants, bars, and nightlife have been hit the hardest by the restrictions brought along by the pandemic: 32,109 restaurants have closed, as of Aug. 31. The number of restaurants forced to permanently close is slightly above Yelp’s total average, at 61%.
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Yelp said in its report:
The restaurant industry continues to be among the most impacted with an increasing number of closures – totalling 32,109 closures as of August 31, with 19,590 of these business closures indicated to be permanent (61%). Breakfast and brunch restaurants, burger joints, sandwich shops, dessert places and Mexican restaurants are among the types of restaurants with the highest rate of business closures. Foods that work well for delivery and takeout have been able to keep their closure rates lower than others, including pizza places, delis, food trucks, bakeries and coffee shops.
Meanwhile, bars and nightlife, an industry 6X smaller than restaurants, has endured an especially high closure rate, with an increasing percentage of closures being permanent. As of the end of August there were 6,451 total business closures, of which 3,499 were permanently closed (54%). The share of permanent closures within bars and nightlife have increased by 10% since our Economic Average Report in July.
Retail and shopping follows closely behind restaurants with 30,374 total business closures, 17,503 of which are permanent (58%). Similar to bars and nightlife, the share of permanent closures increased by 10% since July. Both men and women’s clothing, as well as home decor, have the highest rate of business closures.