Retailers in Florida are more likely to survive the pandemic than those in other states, according to a financial advisor with UBS Wealth Management.
The small businesses that make up a big chunk of the retail sector in the Tampa-St. Petersburg area are among the beneficiaries of state action to keep Florida open, said Frank Brawley, senior vice president of the UBS Brawley Wealth Management Group in Tampa. The survival of those small companies will have a long-term positive impact on the economy, he said.
Brawley’s confidence in the state’s retail sector comes as the U.S. Bureau of Labor Statistics has released new numbers, showing how Florida business overall has fared during the pandemic. About half of all business establishments, not just retailers, in the state told employees not to work, with or without pay, the BLS said. That’s a little lower than the U.S. private sector average.
There were a substantially higher number of businesses in Florida who continued paying their workers while they were not working during the pandemic, according to the BLS.
The BLS also reported that 64.22 percent of Florida’s business establishments received a coronavirus-related loan or grant tied to rehiring or maintaining employees on the payroll. That’s slightly higher than the national average of 62.13 percent.
The retail sector has been especially hard hit by the pandemic. American retailers have announced 8,400 closures this year, according to CNN, citing data from Coresight Research.
But the trend started prior to the pandemic, Brawley said.
“Going into the pandemic, you heard a lot about the death of retail and it happened with the beginning of Amazon. As soon as we could start buying things on Amazon and getting them the same day or the next day, you heard a lot about the death of retail,” Brawley said.
“Our view is retail is not dead. It’s not going away. But retail is changing and the pandemic accelerated those changes. What UBS thought would take four to eight years to unfold was crammed into a six-month period.”
While businesses deemed essential, such as grocery stores, never closed during the pandemic, a lot of those deemed non-essential, including mom and pop retail stores, were closed, Brawley said.
“I don’t fault the politicians for saying there’s essential and nonessential businesses. No one has ever dealt with this before. We didn’t know how the pandemic spread or how deadly it was or how to treat it. All those things were very scary and we didn’t know what to do, so they did what they thought best, which was to shut things down,” Brawley said.
On March 25, Pinellas County enacted a “safer at home” measure that required non-essential businesses to close, unless they could comply with social distancing measures. Pinellas County rescinded its measure in early May. Similar measures were in place in other Florida counties, but not statewide.
Covid-19 cases and deaths leveled off during the summer, then started to surge again in the fall, both locally and nationally.
While other states have put in place new restrictions on businesses, Florida Gov. Ron DeSantis has said he will not do so, and in late November DeSantis extended an executive order that bars local governments from enforcing violations of mask mandate.
Critics have said DeSantis’ actions will lead to more cases of Covid-19.
Small businesses owners see DeSantis’ approach as vital for survival, Brawley said. He cited a conversation with a hair salon owner whose salon was shut down in March and April, and who is married to a chef who lost his job.
“They made it with government assistance, but she said, ‘Frank, if I were cutting hair in a different state and we were shut down, my kids wouldn’t have Christmas … We would be declaring bankruptcy. We couldn’t do it again,’” Brawley said.
While remaining open, most small business owners are taking the virus seriously, Brawley said.
“There is social distancing when you go into a restaurant, or any store. And every store, at least in the Tampa area, has signs that say you can’t come in without a mask,” he said.
He’s also seeing a groundswell of customers trying to support local businesses whenever possible.
“We know these people. We go to church with them. Our kids play softball together. We know these men and women who own these businesses and we’ve seen firsthand how hard it was when they shut down,” Brawley. “If there is a silver lining, it is that there is a real effort among the community to try to shop local and support those businesses.”
Both Tampa and St. Petersburg will benefit as a result, he said.
“Our economy thrives on small businesses,” he said. “Now that they are fully up and running and we are getting into the holiday season, the traffic is higher. People are out and spending money. The fact that the small businesses are open is having a very positive impact on the local economy, because they are our lifeblood.”
Longer term, Brawley expects to see small business owners who have faced shutdowns in other states to relocate to Florida if they are able to move.
“Only time will tell but I think it will have a lasting impact on our economy and our population growth,” he said.