Economists say second shutdown would be devastating for small business

Reporter: Taylor Petras Writer: Jack Lowenstein
Credit: WINK News.

Dr. Anthony Fauci said states with spikes in the coronavirus should “consider shutting down,” he told The Wall Street Journal recently. But could Florida survive a second shutdown? A second shutdown could mean an end for many businesses in Southwest Florida.

Florida economists we spoke to Tuesday said a second shutdown in Florida would be devastating for small businesses.

For example: The Java House relies on the people who work in downtown Fort Myers. Lately, the streets downtown have been a lot less busy, with many people still working from home. Owner Mike Peters says he’s staying afloat, but a second shutdown would be devastating.

There’s only one way to describe the traffic coming through mike peters coffee shop.

“A roller coaster,” Peters said. “Some days are up. Some days are down.”

During Florida’s “safer-at-home” order in April, Peters, his wife and two part-time employees had to do to-go orders only.

“It was extremely slow,” Peters said.

And there’s only one way economists can describe what the order did to Florida’s economy.

“It was catastrophic,” said Tom Smythe, an FGCU professor of finance.

“Economically devastating,” said Sean Snaith, a professor at the UCF college of business.

As COVID-19 numbers rise and reopening procedures roll back, the possibility of another shutdown worries experts.

“The economic impacts could be prolonged, and they could be substantial,” said Chris Jones, an economics professor at USF. “And they could worsen from where we are today.”

And small businesses like Java House likely wouldn’t survive another month of restrictions.

“To let them open up and get the people back and then all of the sudden shut them back down again, the cost of shutting down and reopening is huge,” said Randy Moffett, an economics professor.

Meanwhile, Peters is still recovering from the first shut down.

“If it does it again for who knows how long, I don’t know how long any of us can last,” Peters said. “It’s just hard. It’s very tough.”

Java House received a PPP loan, which helped keep the doors open and the coffee brewing. But a second shutdown might be too much to overcome, Peters said. And he’s likely not alone.

“I actually think it might be worse than the first time,” Smythe said. “My logic is really based on the impact it would have on consumer confidence.”

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