Friday, January 21, 2022
Jan. 21, 2022

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Pandemic-Caused Recession has Hit Small Businesses the Hardest

State’s Department of Commerce offers grants, resources to support equitable recovery


Last March, COVID-19 plunged us into a recession. Although all businesses in Washington have experienced some disruption, small businesses have been hit the hardest. Unlike our last recession of 2007-08, this recession disproportionately has affected small businesses, which represent a larger segment of disadvantaged populations.

On the other hand, our large industries—particularly some companies in life sciences, technology and clean energy—are thriving. Washington’s diverse economy is well positioned globally. Even amid the pandemic and recession, many of these businesses have experienced tremendous growth. An excellent example in Clark County is AbSci, a leading biotech company that recently raised an additional $65 million to grow its platform.

Washington’s Department of Commerce is taking a two-pronged approach during the pandemic. First, we are focusing on relief for those businesses and communities most impacted by the pandemic. Second, Commerce is staying focused on the future economy, industrial transition and creating more long term, living wage jobs in high tech and advanced manufacturing.


In order to understand how the pandemic and recession are affecting our state’s businesses and workers, Commerce invested in an economic recovery dashboard accessible to all on our website. Through data points, we can look at the health of our state’s economy and can break it down by industry, region and demographics. The data revealed that certain industries disproportionately have been impacted: tourism, leisure, restaurant and hospitality. Studying this data helps illuminate our next steps toward recovery.

Recognizing that small businesses needed cash to stay afloat, the governor and his budget office authorized more than $200 million in state emergency and federal CARES Act funds for direct aid to highly impacted businesses and certain nonprofits. This allowed Commerce to administer several rounds of small business grants in 2020.

In the past nine months the State has sent funds to more than 13,000 small businesses – prioritizing those hardest hit by the pandemic. More funding will be available to assist small businesses in 2021—and we will be sure to help get the word out about these opportunities. Commerce isn’t the only small business program. Many counties, cities and private sector small business grant programs have been available during the pandemic.

Realizing that there are enormous equity gaps, we’re continually evaluating how we think about equity and how we can assist disadvantaged small business owners. Creating an equitable recovery strategy starts by embracing values that position equity at the forefront.

We looked at how we can better partner with and support organizations around the state that are focused on supporting historically disadvantaged communities. Prior to the onset of COVID-19, we created the Commerce Resiliency Network, a group of primarily nonprofits, to build partnerships in organizations that are a trusted messenger to that community, and we’ve worked to grow that network over the last year.  One such partner is Hispanic Metropolitan Chamber that supports the Latino community in Oregon and Southwest Washington.

While we continue to direct our efforts toward small business support in various ways, there are also other systemic challenges that need improving if everyone is going to be able to have access to employment. Among the most challenging barriers facing many businesses and workers today is access to quality broadband and access to affordable childcare. The digital divide in Washington is wide, affecting both low income city dwellers and rural communities, and a lack of sufficient child care access is a continuing challenge for parents – especially women.  Both of these are crucial legislative priorities for Commerce in the coming months.


Commerce continues looking toward next generation industries. It’s imperative that while we focus on the important work of repairing the small business ecosystem we simultaneously focus on the next 40 years of economic development to build the economy of the future. With our clean, affordable energy and exceptional workforce, Washington is equipped to compete globally. As we look ahead at our robust tech industry and consider how we can compete in AI, quantum computing, or innovative clean energy products, the state has significant opportunity to produce products for which there is a high global demand.


Business Resiliency Network:

See a roundup of COVID-related assistance here:

Solar panel manufacturer Violet Power in Grant County has modeled how businesses can be more than manufacturers. By thinking creatively about new ways of doing business, they can be thought leaders, too. Commerce is working toward an industry cluster acceleration program, which would provide resources for co-location. Violet Power is the first company in the nation that not only manufactures solar panels, but also will integrate the supply chain with manufacturing of solar cells and wafers required in the solar industry. There are more opportunities like this out there for Washington State if we can compete for them.

Even during this pandemic as we’ve experienced widespread economic disruption, we’ve seen business success stories of growth, expansion, opportunity and creating family-wage jobs. One case in point is the recent success of ZoomInfo, based in Clark County, having one of the most successful tech industry initial public offerings in the country last year.

Although 2020 brought enormous challenges and the reverberations of COVID-19 continue to present challenges for many small businesses, innovative businesses throughout Washington stepped up to find a new way to do business. Commerce will maintain the focus on recovery and resiliency as we look ahead to the next chapter of the state’s economy.