Politicians in America and Europe scramble to help small firms

RANDY HATHCOCK appeared to be out of options. The time had come for the owner of H&T Truss Mill, a construction company in Arkadelphia, Arkansas, to decide how many of his 16 employees to sack. The pandemic had led to orders drying up. Then a lifeline appeared. The Paycheck Protection Programme (PPP), a scheme administered by America’s Small Business Administration, promised enough to cover two-and-a-half months of wages. It was “an answer to our prayers”, says Mr Hathcock. If he retains his staff for two years, the $161,200 loan turns into a grant.

Voters abhor bail-outs when they involve airlines and Wall Street, but seem altogether happier to provide succour to the likes of Mr Hathcock and Main Street. Politicians in America and Europe have all the more reason to help: small and medium-sized businesses (SMEs) have been clobbered by the pandemic, even more so than their larger peers. Fully 60% of people who worked for businesses with fewer than ten employees in America at the start of the year have since been fired, according to one study. In Britain, seven in ten firms managed by their owners say they have lost over half their revenue.

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via The Economist: Finance and economics Business Feeds

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