Are Small Businesses Surviving in a Post-Covid World, according to a study, the covid-19 pandemic had caused massive dislocation among small businesses. The effects were felt just several weeks after its onset– more so prior to the government providing aid through the Coronavirus Aid, Relief, and Economic Security (CARES) Act. The study concluded that 43% of businesses had temporarily closed– primarily due to covid-19 and lockdown restrictions.
Are Small Businesses Surviving in a Post-Covid World
The United States has also seen a boom in new businesses since the start of the covid-19 pandemic. While many companies were forced to retrench and downsize in order to keep their doors open, the country had also experienced a spike in new entrepreneurs who were now deciding to take matters into their own hands and become their own bosses.
Recovering from Post-Pandemic Job loss
Texas, Arizona, Idaho, and Utah have managed to recover from the pandemic depths, attributing this accomplishment to population growth as well as a shift by businesses and workers who are moving away from coastal urban areas. These states have benefited from the demographic shifts prior to and during the pandemic—having experienced an outsize in payroll growth in industries such as retail, technology, warehousing, and transportation. Many large companies have moved their operations to these states, and some of their workers have moved in as well– leaving the more densely populated and expensive urban areas.
A Startup Boom in Texas
A contributing factor to Texas regaining the jobs that were lost during the covid-19 pandemic is that is the number of new businesses that have started up in the state. Last year, Texas had the fourth-highest number of business startups in the U.S. The Lone Star State was able to reach an impressive high of more than 490000 new business startups that had been created in 2021. This is a big jump for the state that had seen around 385,559 in 2020. The latest 2021 figures represent the highest total that Texas has ever experienced; since it began tracking back in 2004. Impressively, Texas held 61% more business startups last year than it did prior to the pandemic.
For small businesses, it is vital that a solid foundation is laid out at the onset so that growth is supported by a concrete start. A Texas LLC allows small businesses to benefit from the flexibility that they would have if they took up a sole partnership or partnership business structure, but it also provides the legal protection that comes with filing to start a corporation. An LLC will also provide entrepreneurs with the unique benefit that comes with pass through taxation so that the profits that members receive do not get subject to double taxation.
To start an LLC in Texas, entrepreneurs will be required to file the Certificate of Formation via the Texas Secretary of State– with a filing fee of $300. Applications can be processed either online or by mail. The Certificate of Formation is the legal document that makes the LLC an official business entity in Texas. The entire formation process can be broken down into five necessary steps:
- Name the Texas LLC
- Choose a Registered Agent in Texas
- File the Texas Certificate of Formation
- Create an Operating Agreement
- Get an EIN
Final Thoughts
The covid-19 pandemic had forced a global paradigm shift; while larger businesses were scaling down, entrepreneurs took the chance to start up their own ventures. Starting a new business takes a great deal of determination, countless hours of hard work, and a decent amount of resilience, the feeling of accomplishment often is the motivation that allows entrepreneurs to keep the ball rolling.