Courtesy USA Today 5/14/20 Page B3
The passing of the $480 billion relief package to help small businesses and hospitals is a step in the right direction.
Part of me, however, can’t help but fear what happened less than two weeks ago. The original federal small business relief program – the $350 billion Paycheck Protection Program – ran out of money quickly. Small businesses were left in danger while policies continued to favor big business. We cannot let that happen again.
In late March, only 20% of entrepreneurs rated the economic climate as positive for entrepreneurship – a more than 30% drop from earlier in the month. In contrast, 60% of entrepreneurs believe the economic climate remains positive for big business.
The type of local innovation we’re seeing from Accelerator for America, the Birmingham Strong Fund, and the KC COVID-19 Small Business Relief Fund is critical to address the needs of small and new businesses during the pandemic, and there are similar examples throughout the country.
But the federal government needs to take action, too, with both short-term and long-term policies that can further ensure small businesses weather this immediate crisis and rebuild for the long term.
We need to take action now to position small business owners and entrepreneurs for success. Our nation’s long-term prosperity depends on it.
To respond adequately to the crisis, here are some ideas we should be considering now:
And to rebuild for a stronger future, we should consider:
During the last week of April, the European Commission under the patronage of Mariya Gabriel hosted an online pan-European Hackathon #EUvsVirus. It brought together more than 20,000 enthusiastic participants: entrepreneurs, researchers, civil societies, big businesses and the government. In a course of 48 hours, registered teams had to come up with innovative solutions that can be implemented immediately to fight the spread of the COVID-19 and its negative impacts on our society.
There were six main topics: Health & Life, Business Continuity, Social & Political Cohesion, Remote Working & Education, Digital Finance, and Other. Within them, there were 37 challenge tracks devoted to a smaller pocket of those key topics. At. the end of the Hackathon weekend there were more than 2,000 unique projects submitted.
As a think tank for sustainable development composed of self-employed experts, we saw it as a great opportunity to come up with an idea that could help empower entrepreneurship in the time of crisis and propose it to the EU government.
According to the reports of the United Nations, International Labour Organization and OECD, self-employed people and freelancers are one of the groups that are affected the most by the slowdown of the economy and the quarantine. There are over 32 million self-employed professionals in Europe. But there is no policy covering their unemployment or sick leave. Their savings at the beginning of the lockdown were estimated to last two to three months on average. That means that soon they might be at risk of poverty.
Military OneSource Net
The Department of Defense is working closely with the Centers for Disease Control and Prevention and the U.S. Department of State to provide support in dealing with the coronavirus disease outbreak.
Thirty Million small business jobs are vulnerable -a higher share than at private-sector employers.
A precipitous surge in unemployment continues to shake the US workforce in the wake of COVID-19. Total claims reached 30 million in the six weeks since March 14th. And even as initial steps are underway to ease lockdowns, up to a third of all US jobs remain vulnerable.1 One of the challenges for policy makers and executives is figuring out how to get these employees back to work.
The challenge is especially acute for small businesses (those with 500 or fewer employees), which account for a disproportionate share of the vulnerable jobs.2 Before COVID-19, they provided nearly half of all US private-sector jobs, yet they account for 54 percent (30 million) of the jobs most vulnerable during COVID-19. Specifically, half of jobs at firms with fewer than 100 employees are vulnerable, compared with 40 percent of those at large private-sector employers (Exhibit 1). That estimate is based on our analysis of whether jobs are typically deemed essential and whether they require close proximity to others.
Vulnerable jobs in small businesses largely mirror those in larger ones. Nearly half of these jobs are concentrated in a handful of industries, especially accommodations and food services, construction, retailing, and healthcare and social assistance. Two occupational categories—food service and customer service and sales—account for more than four in ten vulnerable small-business jobs.3 There is a serious danger that the loss of work will disproportionately affect those who can least afford it, since workers in these occupations have lower wages and educational attainment, on average (Exhibit 2).4
Given the distribution of industries and occupations in each of the states, 42 of the 50 states will have a larger share of their vulnerable jobs in small businesses than in large ones. Vulnerable jobs in the other eight states are nearly evenly split between large and small businesses. More than half a million small-business jobs are at risk in 22 of the 50 states. In California, Florida, Illinois, New York, Ohio, Pennsylvania, and Texas the number of vulnerable small-business jobs ranges from 1.0 million to 3.5 million per state.
Small businesses are a recognized proving ground for entrepreneurs, a vibrant source of innovation and competition, and an essential source of employment. They are suppliers and customers to the broader economy and deeply embedded in local communities. Many were vulnerable even before the crisis, with the median small business holding a 27-day cash buffer in reserve.5
The public and private sectors have taken significant steps to support small businesses and their employees. They have made some resources available to help small business weather the immediate crisis.
There is still a long journey ahead. More should be done to understand the underlying fragility of individual sectors and firms over the medium and longer term. Such an analysis will be helpful in understanding how to best support small businesses, their owners, and their employees through and after the COVID-19 crisis.
As COVID-19 spreads in countries around the world, governments have already started to address the economic and livelihood challenges posed by the constraints the pandemic has put on behavior and employment. Wealthier OECD countries are designing economic support measures to target the backbone of most economies – the tens of thousands to millions of small businesses. These efforts intend to provide a lifeboat to help businesses survive the coming months, and importantly, to continue to pay their employees as normal economic life slows down at a disastrous pace. The U.S. has a congressional coronavirus relief fund for small businesses. The Australian government has put into place a series of measures that are mostly targeting small and medium enterprises (SMEs) with a turnover of less than $50 million, which include stimulus payments and measures such as a tax credit to boost cash flow for employers. The European Investment Bank announced a €25 billion fund especially aimed at SMEs, with the goal of slowing down job losses.
These measures will help cushion the impact of COVID-19 on employment in wealthier areas. But what about lower-income countries? As a recent Oxfam report noted, 500 million people – largely in developing countries – could be pushed into poverty during this pandemic. And efforts to support the SMEs that drive employment in these countries are complicated by the unique nature of these businesses.
According to the International Labour Organization, 93% of the world’s informal employment is in emerging countries. In Africa alone, over 85% of employment is informal. Developing nations across Africa are also attempting to provide economic support packages targeting their SMEs, but this informality makes it difficult. Many small businesses – from micro-enterprises which operate as traders, to small restaurant businesses, for example – have no incorporation and no listed employees with bank accounts.
This presents developing nations with a vexing challenge: determining what mechanisms can quickly deploy economic support to these informal businesses and individuals, and what methods can target them effectively. This challenge threatens to reduce the effectiveness of the measures currently being put into place. For instance, in March, Ghana announced a 1 billion cedi stimulus package (~$173 million USD) for households and businesses, particularly SMEs. But it includes measures like extending the tax filing date and reducing the central bank interest rate. That sounds fine for the formalized, but likely won’t mean much to the countless informal enterprises that don’t pay taxes or access formal finance, which comprise the vast majority of the economy.
In many developing nations, there are disincentives for businesses to become formalized, in terms of cost, time and risk. Where there is corruption at many levels of government, weak rule of law, and cumbersome and unclear taxation rules, formality can feel unnecessary – not to mention risky. For many business owners, formalizing their enterprise means paying various random taxes demanded by obscure government offices (while seeing no reliable public benefits) – or being asked to pay a bribe to be left alone.
Further complicating this picture, there is also informality at the individual level: poor and weak identification systems that omit large populations in many emerging countries. According to the 2018 Global ID4D Dataset, an estimated 1 billion people lack a foundational ID, and 50% of them live in Africa. And among those below the national ID age, 47% don’t even have birth registration. This lack of formal ID is greatly complicating efforts to deliver economic relief, in countries around the world.
Payment systems are the distribution end of financial assistance, and speed and efficiency are of paramount importance in leveraging these systems to address a crisis like COVID-19. Digital payments platforms have proven to be extremely effective in allowing people to buy items and make and receive payments at a distance, without any physical presence or cash – something that is increasingly essential in this age of social distancing. These platforms have begun scaling in many emerging markets, and beyond rapid digital payments, they offer basic account functionality – particularly important in countries where 60-80% of people often do not have a traditional bank account. These digital accounts already serve as a destination for government benefit and income support payments, in countries from Senegal to India.
There has been plenty written about mobile money and digital payments, and how they can be – and need to be – leveraged right now. Yet as the pandemic progresses, gaps and challenges in the payments and banking systems are becoming visible in many countries – often driven by the lack of formal ID and the required Know-Your-Customer registration processes. Without effective identification, payments cannot be effectively targeted or delivered to the individuals or SMEs that need them – and it’s almost impossible to confirm that these payments have reached their intended target. Unless these payment system gaps are addressed, inequality will only be exacerbated, worsening an already-grave economic crisis.
In countries where a huge proportion of small and micro-businesses are informal, direct government-to-person (G2P) transfers will make the biggest impact. During a pandemic when delivery systems are stressed, investing in or fast-tracking digital G2P payment systems can be vital. Governments in these countries are focusing on scaling up payment and account systems that can be provided rapidly at very low cost – including to the informal economy. Even with the large gaps in identification systems, some governments are not hesitating at all in their efforts to quickly deploy economic support to the entire population. For instance, Togo has set up a cash grant designed to support informal workers during the three months of state-mandated social distancing – an unconditional cash transfer grant that gives each worker 30% of the minimum wage. The aim is to help beneficiaries pay for basic daily necessities such as food, sanitation and communication, to cushion them from the full economic impact of COVID-19 distancing. Citizens sign up via mobile phone, and the transfer is delivered by mobile money. Similarly, in Pakistan, poorer citizens may now use their mobile phone to enroll in an emergency support program run by the newly created Ministry of Social Protection and Poverty Alleviation, with payments transferred digitally and linked to biometric identity. And Jeffrey Bower, founder of Bower & Partners, a consulting firm that designed Peru’s interoperable payment switch, reports that the switch is being used to pay a COVID-19 subsidy to 50% of Peruvians.
To expand on these types of initiatives, African governments and their partners need to find mechanisms – or improvise them if necessary – to extend support payments to their populations and small businesses, to help them make it through the COVID-19 crisis. If they don’t, they risk losing the progress their economies have made over the past decade – along with potential threatening outcomes; civil unrest, loss of community trust, and the spread of disease and death.
This article is part of NextBillion’s series “Enterprise in the Time of Coronavirus,” which explores how the business and development sectors are responding to the pandemic. For news updates and analysis, virtual events, and links to useful resources related to the COVID-19 crisis, check out our coronavirus resource page.
The IRS began rolling out economic impact payments this month, delivering financial relief to the majority of Americans. If you haven’t received your payment yet, you may have a number of questions, including whether you qualify and how much you’re eligible to receive.
If you don’t typically file taxes because of your income or because you receive certain benefits, you may still need to submit your information to the IRS, and there’s an online portal for non-filers to help you through this process.
Frequently Asked Questions and Facts About the Coronavirus
Has COVID-19 prompted you to rethink what success looks like for yourself or your team? You’re not alone. These unparalleled times have prompted many to think about how to bring purpose and authenticity to their lives.
Our CEO Jean Case has been drawn to both rereading some of her favorite books from the past as well as seeking inspiration from new works just hitting the shelves. She has a roundup of nine books perfect for providing inspiration and perspective while staying at home.
These topics were also in the forefront of our team’s mind this week as we hosted a virtual book launch party for our friend, Doug Holladay’s new book “Rethinking Success: Eight Essential Practices for Finding Meaning in Work and Life.” If you missed the conversation, you can watch the full virtual launch, introduced by our Chairman Steve Case, where our CEO Jean Case interviews Doug and gets his recommendations on how you can begin to live a life of purpose today.
F I N I S
Courtesy HelloAlice.com – Help to start and grow a business.
The first scenario is the development of a safe and effective vaccine sometime in 2021. There are a lot of moving pieces to create a vaccine, and make sure it’s safe, and to produce enough and distribute it.
There are promising trials — too numerous to mention. Following those closely will be lots of ups and downs. Things that seem promising early often fade. Things don’t work on everyone. And it’s possible that a vaccine will be safe, but only partly effective or offer a partial inoculation. If that’s the case it may be used in health care workers on the frontline and in nursing homes, and high risk people.
The second scenario I spent a lot of time discussing today is Covid-19 as a chronic disease without a reliable vaccine. While initially jarring to contemplate, there is good evidence and history that this would be a manageable nor a crippling situation.
Currently, the conditions brought on by severe Covid-19 are scary & mysterious. It attacks the lungs and travels to other organ systems. We’re still learning about it. But with the help of supercomputers and data, we will learn fast. We’re not sure which therapies work in later stages (we know which don’t). But we have good anecdotal evidence that they work to reduce the viral load and lethality if given early.
We are quickly learning what is causing our immune systems to react. There’s evidence that it’s the level of d-dimer in the body. In fact it may not be the severity of the strain but the peculiarities of our own immune systems which could determine the severity of the virus.
So while antibodies may be the most effective treatment, it may in fact be things which prohibit the virus from replicating in our body that’s the key, if we can do it early. Biologics, protease inhibitors, or even steroids could be effective.
There’s a third scenario where the virus is destroyed completely by something far simpler — a reusable, cleanable highly functional and nearly free mask. Viruses can’t survive with nowhere to go. Cutting the virus off at the pass may be simplest done by never letting the droplets get into the air. The more some think about the third scenario, the more the first two become less scary and less important.
In this third scenario, lots of things — compliance, culture change, fit, ubiquity, fashion, ease of use, breathability, and equitable distribution — are all factors. Even if you don’t welcome the idea of wearing a mask for a period of time (and I would argue, why not?), the larger point is we are not powerless in the face of this virus. We have science, ingenuity, and collective action.
The Antibody Problem
|Antibody tests have been plagued by concerns of accuracy. Such tests look for signals that a person’s body has encountered SARS-CoV-2, rather than hunting for the virus itself. But finding those signals is more complicated than simply diagnosing the disease.
On Monday, the White House acknowledged that complexity, suggesting that the U.S. should perhaps use two antibody tests at a time to gain a more accurate picture of how many people in the country have actually contracte the virus. In a document detailing the U.S. national strategy to expand testing efforts, the Trump administration said that the use of two tests at once would allow for the results to be checked against each other, producing, in theory, data that is more reliable.
|Here’s promising news in the worldwide race to develop a vaccine to ward off the coronavirus. The Jenner Institute at Oxford University has one that seems to work in lab animals and is ready to test its effectiveness in humans, if regulators approve.|
|The institute had a big head start, our correspondent David D. Kirkpatrick reports. Its scientists had an approach that they already knew was safe: They had proved it in trials last year for a vaccine to fight MERS, a respiratory disease caused by a closely related virus.|
|That has enabled the institute to skip ahead and schedule tests of its new Covid-19 vaccine on more than 6,000 people by the end of May, hoping to show not only that it is safe, but also that it works.|
|Scientists at the National Institutes of Health’s Rocky Mountain Laboratory in Montana got very good results when they tried out the Oxford vaccine last month on six rhesus macaque monkeys. The animals were then exposed to heavy quantities of the coronavirus. After more than four weeks, all six were still healthy.|
|“The rhesus macaque is pretty much the closest thing we have to humans,” said Vincent Munster, the researcher who conducted the test.|
|Immunity in monkeys doesn’t guarantee that a vaccine will protect people, but it’s an encouraging sign. If the May trials go well and regulators grant emergency approval, the Oxford scientists say they could have a few million doses of their vaccine available by September — months ahead of other vaccine projects.|