Small Business Saturday: Consumer spending projected to set new records

Small businesses negatively impacted by COVID-19 pandemic

Census data shows the impacts of the pandemic on U.S. small businesses.

Black Friday is over, and now it’s time for holiday shoppers to flock to the small businesses in their communities.

Saturday marks Small Business Saturday — a day created by American Express in 2010 to shift consumers’ attention to the stores that call their communities home. Shoppers are encouraged to shop small and buy locally.

And according to the U.S. Small Business Administration (SBA), that’s exactly what they did last year.

"Last year, shoppers came together in full force to support their local communities, and Small Business Saturday hit a record high with an estimated $19.8 billion in reported spending," the SBA said in a news release. "This year, holiday consumer spending is projected to break new records."

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A 'Small Business Saturday' sign is displayed outside the Fishs Eddy store on Nov. 28, 2020, in New York City. (Photo by Alexi Rosenfeld/Getty Images)

Small businesses have faced great uncertainty throughout the COVID-19 pandemic. Many had to redesign their business model when gathering indoors became unsafe.

The SBA said 6 million small businesses have relied on federal aid to stay afloat during the pandemic. According to the Federal Reserve, as many as 200,000 of them ceased operations in the first year of the pandemic.

The SBA provided $44.8 billion to small businesses through more than 61,000 loans in the 2021 fiscal year.

But it hasn’t been all bad news. Many millions of businesses got their start in the midst of the pandemic.

According to the Committee on Small Business, Americans filed paperwork to start 4.3 million new businesses in 2020 — a 24% increase from 2019 and the highest number in the past 15 years. Rep. Nydia Velazquez, who chairs the committee, said young entrepreneurs dealt with a tough job market by pivoting towards entrepreneurship to develop businesses and products to serve their communities.

"COVID closed countless small businesses and left many others on the brink of disaster," said Velazquez, a Democrat representing New York’s seventh congressional district. "Yet, at the same time, it’s possible the pandemic set in motion a revitalization of American entrepreneurship."

Nearly every community has small businesses serving local customers. Think of the family restaurant that’s been open for decades, the book stores with the vintage look or the local gyms that aren’t as crowded as the big chains.

Still need holiday photos of your loved ones, there is no shortage of local photographers willing to capture you on film. A local jeweler may have a better discount than the national stores. And with Valentine’s Day just around the corner, a gift card to a floral shop would come in handy before you know it.

This story was reported from Atlanta.