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July 23, 2020

Analysis: 143 Greater Worcester businesses have closed permanently amid recession

Photo | Grant Welker A man walks by a vacant storefront on Front Street in downtown Worcester.

More than 140 businesses across the Worcester metropolitan area have closed permanently since the coronavirus pandemic hit, and roughly 100 more have closed temporarily, according to an analysis by the online business site Yelp.

Those closures, which took place between March 1 and July 10, give the most detailed look yet at how Greater Worcester businesses have been hit dramatically by the national recession started in February and the pandemic that followed. According to Yelp, 143 businesses on its site are marked as permanently closed, and another 104 are temporarily shuttered.

Closures include businesses of all types, not just restaurants Yelp is largely known for with its consumer reviews.

[Related: Mass. unemployment claims fall 24%, but still total 18K]

The Worcester metro area, which includes Worcester County and Connecticut's Windham County, had an unemployment rate in May of 14.6%. That rate, the most recent available, exceeds the national rate in May of 13.0% and the Worcester-area rate a year prior of 3.2%, according to the U.S. Bureau of Labor Statistics. That year-to-year difference translates to 42,500 lost jobs in the region.

Yelp, whose data was released Wednesday, said it found a correlation between states with high consumer activity in May and a subsequent rise in coronavirus cases in June.

Massachusetts has been among the states with the most improved coronavirus case rates, down significantly from a peak in late April. Interest on Yelp for restaurants, bars and gyms in Massachusetts in May was up 7%, the sixth lowest nationally, behind Maine, New York, Alaska, Delaware and New Jersey.

The biggest spike in consumer interest — and an implied return to normal economic activity — took place largely in states that have had more recent spikes in coronavirus cases, including Florida, South Carolina, Alabama and Arizona.

That suppressed economic activity in Massachusetts has kept the state relatively healthy while new cases have remained around record highs nationally. But it has also come at an economic cost. The state's unemployment rate in June of 17.4% was the country's worst.

Yelp reported 132,500 closed businesses nationally as of July 10, 55% of which it said were permanent. Massachusetts ranked 14th highest nationally for the rate of temporarily or permanently closed businesses at roughly 7 per 1,000 businesses.

Restaurants and retail have been hit hardest nationally, according to Yelp. More than 26,000 restaurants have closed, 60% of which are permanent. In retail, 48% of roughly 26,000 businesses have closed for good.

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July 24, 2020

I take exception to the use of the word "recession" in the title. For last several months, since the government overreach has allowed businesses to reopen, there are been a steady decline in unemployment and increase in business revenue. That is not a recession to me!

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