The Paycheck Protection Program and small business performance: Evidence from craft breweries
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ABSTRACT:
SUBMITTER: Staples A
PROVIDER: S-EPMC9763080 | biostudies-literature | 2022 Dec
REPOSITORIES: biostudies-literature
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Project description:This paper provides a comprehensive assessment of financial intermediation and the economic effects of the Paycheck Protection Program (PPP), a large and novel small business support program that was part of the initial policy response to the COVID-19 pandemic in the US. We use loan-level microdata for all PPP loans and high-frequency administrative employment data to present three main findings. First, banks played an important role in mediating program targeting, which helps explain why some funds initially flowed to regions that were less adversely affected by the pandemic. Second, we exploit regional heterogeneity in lending relationships and individual firm-loan matched data to study the role of banks in explaining the employment effects of the PPP. We find the short- and medium-term employment effects of the program were small compared to the program's size. Third, many firms used the loans to make non-payroll fixed payments and build up savings buffers, which can account for small employment effects and likely reflects precautionary motives in the face of heightened uncertainty. Limited targeting in terms of who was eligible likely also led to many inframarginal firms receiving funds and to a low correlation between regional PPP funding and shock severity. Our findings illustrate how business liquidity support programs affect firm behavior and local economic activity, and how policy transmission depends on the agents delegated to deploy it.
| S-EPMC9409445 | biostudies-literature
Project description:The Paycheck Protection Program (PPP) extended 669 billion dollars of forgivable loans in an unprecedented effort to support small businesses affected by the COVID-19 crisis. This paper provides evidence that information frictions and the "first-come, first-served" design of the PPP program skewed its resources towards larger firms and may have permanently reduced its effectiveness. Using new daily survey data on small businesses in the U.S., we show that the smallest businesses were less aware of the PPP and less likely to apply. If they did apply, the smallest businesses applied later, faced longer processing times, and were less likely to have their application approved. These frictions may have mattered, as businesses that received aid report fewer layoffs, higher employment, and improved expectations about the future.
| S-EPMC7441872 | biostudies-literature
Project description:The Paycheck Protection Program (PPP), a principal element of the fiscal stimulus enacted by Congress in response to the COVID-19 economic shock, was intended to assist small businesses to maintain employment and wages during the crisis, as well as cover other expenses. We use high-frequency administrative payroll data from ADP—one of the world’s largest payroll processing firms—to estimate the causal effect of the PPP on the evolution of employment at PPP-eligible firms relative to PPP-ineligible firms, where eligibility is determined by industry-specific firm-size cutoffs. Our estimates indicate that the PPP boosted employment at eligible firms by between 2 percent to 5 percent at its peak effect around mid-May 2020. The boost to employment waned thereafter and ranged from no effect to a 3 percent boost at the end of 2020. Our estimates imply that employers retained an additional 3.6 million jobs as of mid-May 2020, and 1.4 million jobs at the end of 2020, as a consequence of PPP. The estimated cost per year of employment retained was
| S-EPMC9757653 | biostudies-literature
Project description:Do medical facilities also help advance improvements in socio-economic outcomes? We focus on Veterans, a vulnerable group over the COVID-19 pandemic who have access to a comprehensive healthcare network, and the receipt of funds from the Paycheck Protection Program (PPP) between April and June as a source of variation. First, we find that Veterans received 3.5% more loans and 6.8% larger loans than their counterparts (p < 0.01), controlling for a wide array of zipcode characteristics. Second, we develop models to predict the number of PPP loans awarded to Veterans, finding that the inclusion of local VA medical center characteristics adds almost as much explanatory power as the industry and occupational composition in an area and even more than the education, race, and age distribution combined. Our results suggest that VA medical centers can play an important role in helping Veterans thrive even beyond addressing their direct medical needs.
| S-EPMC9778558 | biostudies-literature
Project description:ImportanceStaffing shortages in nursing homes (NHs) threaten the quality of resident care, and the COVID-19 pandemic magnified critical staffing shortages within NHs. During the pandemic, the US Congress enacted the Paycheck Protection Program (PPP), a forgivable loan program that required eligible recipients to appropriate 60% to 75% of the loan toward staffing to qualify for loan forgiveness.ObjectiveTo evaluate characteristics of PPP loan recipient NHs vs nonloan recipient NHs and whether there were changes in staffing hours at NHs that received a loan compared with those that did not.Design, setting, and participantsThis economic evaluation used national data on US nursing homes that were aggregated from the Small Business Administration, Nursing Home Compare, LTCFocus, the Centers for Medicare & Medicaid Services Payroll Based Journal, the Minimum Data Set, the Area Deprivation Index, the Healthcare Cost Report Information System, and the US Department of Agriculture Rural-Urban Continuum Codes from January 1 to December 23, 2020.ExposurePaycheck Protection Program loan receipt status.Main outcome and measuresStaffing variables included registered nurse, licensed practical nurse (LPN), and certified nursing assistant (CNA) total hours per week. Staffing hours were examined on a weekly basis before and after loan receipt during the study period. An event-study approach was used to estimate the staffing total weekly hours at NHs that received PPP loans compared with NHs that did not receive a PPP loan.ResultsAmong 6008 US NHs, 1807 (30.1%) received a PPP loan and 4201 (69.9%) did not. The median loan amount was $664 349 (IQR, $407 000-$1 058 300). Loan recipients were less likely to be part of a chain (733 [40.6%] vs 2592 [61.7%]) and more likely to be for profit (1342 [74.3%] vs 2877 [68.5%]), be located in nonurban settings (159 [8.8%] vs 183 [4.4%]), have a greater proportion of Medicaid-funded residents (mean [SD], 60.92% [21.58%] vs 56.78% [25.57%]), and have lower staffing quality ratings (mean [SD], 2.88 [1.20] vs 3.03 [1.22]) and overall quality star ratings (mean [SD], 3.08 [1.44] vs 3.22 [1.44]) (P < .001 for all). Twelve weeks after PPP loan receipt, NHs that received a PPP loan experienced a mean difference of 26.19 more CNA hours per week (95% CI, 14.50-37.87 hours per week) and a mean difference of 6.67 more LPN hours per week (95% CI, 1.21-12.12 hours per week) compared with nursing homes that did not receive a PPP loan. No associations were found between PPP loan receipt and weekly RN staffing hours (12 weeks: mean difference, 1.99 hours per week; 95% CI, -2.38 to 6.36 hours per week).Conclusions and relevanceIn this economic evaluation, a forgivable loan program that required funding to be appropriated toward staffing was associated with a significant increase in CNA and LPN staffing hours among NH PPP loan recipients. Because the PPP loans are temporary, federal and state entities may need to institute sufficient and sustainable support to mitigate NH staffing shortages.
| S-EPMC10375300 | biostudies-literature
Project description:In the current volatile business environment, companies are obliged to search for new ways of doing business to remain competitive. Accordingly, firms innovate their business model as it became a promising strategy to achieve sustainable outcomes. However, there is still a need for empirical studies that examine the relationship between business model innovation (BMI) and the performance of small and medium-sized enterprises (SMEs). In this study, we aimed to investigate this relationship by collecting data from 264 manufacturing SMEs through structured questionnaires. We employed partial least square structural equation modeling (PLS-SEM) to analyze the collected data and test the hypotheses. The results indicated that changes in any component of the business model, namely value creation, value proposition, or value capture, had a positive and significant relationship with the performance of manufacturing SMEs. Therefore, by innovating their business models, firms can create more value for their customers while capturing value for themselves. In conclusion, increasing use value or decreasing exchange value with customers will help firms create more value and surpass competitors in the marketplace, while also allowing them to capture more value for themselves.
| S-EPMC10220359 | biostudies-literature
Project description:ObjectivesThe purpose of this nationwide intervention was to improve machine safety in small metal fabrication businesses (3 to 150 employees). The failure to implement machine safety programs related to guarding and lockout/tagout (LOTO) are frequent causes of Occupational Safety and Health Administration (OSHA) citations and may result in serious traumatic injury.MethodsInsurance safety consultants conducted a standardized evaluation of machine guarding, safety programs, and LOTO. Businesses received a baseline evaluation, two intervention visits, and a 12-month follow-up evaluation.ResultsThe intervention was completed by 160 businesses. Adding a safety committee was associated with a 10% point increase in business-level machine scores (P?<?0.0001) and a 33% point increase in LOTO program scores (P?<?0.0001).ConclusionsInsurance safety consultants proved effective at disseminating a machine safety and LOTO intervention via management-employee safety committees.
| S-EPMC5010275 | biostudies-literature
Project description:ObjectiveFailure to implement lockout/tagout (LOTO) procedures adversely affects the rate of work-related fatalities and serious traumatic injury and is one of the most frequently cited Occupational Safety and Health Administration standards. This study assesses the impact of a nationwide intervention to improve LOTO in small metal fabrication businesses.MethodsInsurance safety consultants conducted a standardized and validated evaluation of LOTO programs and procedures. Businesses received a baseline evaluation, two intervention visits, and a 12-month follow-up evaluation.ResultsThe intervention was completed by 160 businesses. The mean LOTO procedure score improved from 8% to 33% (P < 0.0001), the mean program score went from 55% to 76% (P < 0.0001), and the presence of lockable disconnects went from 88% to 92% (P < 0.0001).ConclusionsThis nationwide intervention showed substantial improvements in LOTO. It provides a framework for assessing and improving LOTO.
| S-EPMC4961089 | biostudies-literature
Project description:While radiosensitizing chemotherapy has improved survival for several types of cancer, current chemoradiation regimens remain ineffective for many patients and have substantial toxicities. Given the strong need for the development of novel radiosensitizers to further improve patient outcomes, the Radiation Research Program (RRP) and the Small Business Innovation Research (SBIR) in the National Cancer Institute (NCI) issued a Request for Proposals (RFP) through the NCI SBIR Development Center's contracts pathway. We sought to determine the research outcomes for the NCI SBIR Development Center's funded proposals for the development of radiosensitizers. We identified SBIR-funded contracts and grants for the development of radiosensitizers from 2009 to 2018 using the National Institutes of Health (NIH) Reporter database. Research outcomes of the NCI SBIR Development Center-funded proposals were determined using a comprehensive internet search. We searched PubMed, clinicaltrials.gov, company websites and google.com for research articles, abstracts and posters, clinical trials, press releases and other news, related to progress in the development of funded radiosensitizers. To protect the intellectual property of the investigators and small businesses, all information obtained and reported is publicly available. The SBIR Program has funded four contracts and 11 grants for the development of novel radiosensitizers. Two companies have received phase IIb bridge awards. Overall, 50% of companies (6/12) have successfully advanced their investigational drugs into prospective clinical trials in cancer patients, and all but one company are investigating their drug in combination with radiation therapy as described in the NCI SBIR Development Center proposal. To date, only one company has initiated a randomized trial of standard of care with or without their radiosensitizer. In conclusion, the NCI SBIR Development Center has funded the development of novel radiosensitizers leading to clinical trials of novel drugs in combination with radiation therapy. Continued follow-up is needed to determine if any of these novel radiosensitizers produce improved tumor control and/or overall survival.
| S-EPMC7266046 | biostudies-literature
Project description:Leaders play a critical role in the development and execution of Total Worker Health (TWH). Small businesses, in particular, can benefit from strong leadership support for TWH as the burden of work-related injury, illness and fatality, as well as poor health and well-being is high in this population. In the present study, we conducted a program evaluation of a TWH leadership development program for small business leaders using the RE-AIM framework. The goal of the program was to help change leaders' behaviors around health, safety and well-being practices following the theory of transformational leadership. Two leaders from each business participated in pre-training activities on their own, a 6-hour in-person training, and three months of access to virtual training transfer activities, including coaching and goal tracking. Our results suggest that the TWH leadership development program is effective at improving leaders' self-reported TWH leadership practices and that the in-person training was implemented successfully. However, leaders did not report improvements in their personal health and in fact reported increased levels of work stress after the program. We also observed some challenges when implementing our training transfer strategies. Our study suggests that leaders may benefit from attending TWH leadership trainings alongside other colleagues in their organization to facilitate a shared vision and goals for TWH in their organization. As a next step, it will be important to determine the program's effectiveness in changing business TWH policies and practices, employee perceptions of TWH and leadership, and employee health and safety outcomes.
| S-EPMC10291283 | biostudies-literature