41% of Closed Businesses on Yelp Are Not Coming Back

Hopes for a quick economic rebound after the COVID-19 crisis depend in large part on the reopening of businesses that have temporarily shuttered since March, but many businesses that relied on loans or savings to make it through the spring are now out of cash and vying for a fraction of the consumer spending seen before the pandemic’s arrival.

As a result, many temporary closures have become permanent. According to a new economic impact report from Yelp, 41% of the roughly 14,000 businesses on the platform that have closed since March 1 will not be returning. 

Restaurants and retail have taken the biggest losses, with 27,663 retail stores and 23,981 restaurants listed as closed. According to the report, 35% of those retail closures are now permanent, as are a whopping 53% of restaurant closures. 

And while consumer spending remains a far cry from pre-COVID levels, there are signs in Yelp’s report that consumers are eager to patronize certain types of businesses that were largely considered off limits in the early months of the crisis.

People are starting to feel more comfortable participating in indoor activities, with increased consumer interest for escape games (up 182%), Go Karts (up 147%), axe throwing (up 113%), gyms (up 81%), bowling (up 63%) and yoga (42%). That said, in some instances people are still finding ways to stay outdoors while social distancing with an increased interest in mini golf (up 132%), amusement parks (up 28%) and horseback riding (up 21%).

Of course, the coronavirus crisis is not the only event impacting businesses across the country. Yelp’s report also shows new patterns attributable to the ongoing racial-justice protests that swept across the country in May following the killing of George Floyd. Since May 25, Yelp has seen a staggering 1785% increase in searches for Black-owned businesses compared to the first three weeks of May. “Review mentions of “Black-owned” (and related terms) also skyrocketed, up 426%, as people look to support and surface these businesses to the community,” the report notes.

Read the full report at yelpeconomicaverage.com.