Earlier this week the Small Business Administration and U.S. Treasury Department released a list of recipients from the government’s Paycheck Protection Program (PPP), which so far has allocated $521 billion of the $670 billion approved by Congress under the CARES Act to nearly 659,000 borrowers. The Trump Administration claims that this program has supported 51 million jobs, roughly 84% of whom work for small businesses.
At presstime, SBA hadn't released exactly how much each entity was approved to borrow. And some recipients—like retail and fast-food chains, millionaire rock bands, and a business venture led by NFL quarterback Tom Brady, who earned $23 million last year—have raised questions about the program’s purpose and vetting process.
But according to Lendio, a small business marketplace, construction led all industries in total volume among the 100,000 PPP loans totaling $8 billion that Lendio facilitated in partnership with 300 lenders between April 3 and June 30.
FIRST LOAN ROUND LEFT SMALL BUSINESSES STRANDED
The PPP program allowed businesses in many sectors to keep their workers employed even if they were shut down by the coronavirus.
Lendio and its partners tapped into the $350 billion in relief lending that Congress approved in early May, which went primarily to small businesses and small proprietorships.
When Congress approved the first round of PPP loans, its intention was to provide a life raft to businesses forced to close because of the coronavirus pandemic. Borrowers could receive up to 2.5 times their companies’ monthly payrolls, much of which would be forgiven if they keep their workers employed.
However, small businesses struggled to access the first round of PPP loans, totaling $349 billion, which lasted only two weeks and was gobbled up by relatively few businesses. For the second round, Congress earmarked $30 billion specifically for community banks so they wouldn’t have to compete with larger lenders.
The demand was certainly pressing. Lendio points out that prior to participating in the PPP, it had facilitated $2 billion in business loans since its inception in 2011.
The average PPP loan on the Lendio platform is $73,000, versus the national average of $107,000. During the PPP, 30% of the loans that Lendio facilitated went to businesses in urban areas, 28% in the suburbs, and 39% in rural communities. The Pacific and South Atlantic regions of the country accounted for 45% of Lendio’s PPP loans.
LENDIO FACILITATES $182 MILLION IN LOANS TO CONSTRUCTION BORROWERS
About 45% of the PPP loans that Lendio facilitated were to businesses in the Pacific and South Atlantic regions of the U.S.
Of the loans facilitated by Lendio, just under $181.7 million went to businesses in the construction industry, the highest total volume for any sector. Construction was followed by healthcare, restaurants, information media, manufacturing, and retail.
The average loan for construction borrowers was just under $100,000, which ranked fourth by sector, with manufacturing topping this list at $145,568 per loan average.
Lendio estimates that construction borrowers saved 17,500 jobs as a result of the PPP, behind restaurants (31,501 jobs saved), healthcare, and automotive.
ARE MORE LOANS IMMINENT?
Right now, Congress and the White House are debating whether more stimulus is needed, as the coronavirus continues to spread in several areas of the country, with nearly 3.1 confirmed cases of COVID-19 and 133,000 deaths in the U.S., and with hospitalizations rising in 22 states. Some states, cities and towns are reconsidering their plans for reopening their economies.
“Unfortunately, the challenges for small business owners do not end when they receive a PPP loan and great economic uncertainty remains,” writes Lendio. It notes that business owners are now navigating the loan forgiveness process, and others continue to seek financial assistance while operating on thin margins. “As demonstrated throughout the program to date, the need for relief funding is unprecedented and will likely continue as small business owners seek to reopen and rebuild in the coming months.”
Related Stories
| Jul 9, 2014
Dragon-inspired hotel conveys Vietnamese hospitality [2014 Building Team Awards]
An international Building Team unites to create Vietnam’s first JW Marriott luxury property.
| Jul 9, 2014
The one misstep that could be slowing your company’s growth
Change. It’s inevitable. And success for any professional may very well depend on how well we adapt to it. SPONSORED CONTENT
| Jul 8, 2014
Frank Lloyd Wright's posthumous gas station opens in Buffalo
Eighty-seven years after Frank Lloyd Wright designed an ornamental gas station for the city of Buffalo, the structure has been built and opened to the public—inside an auto museum.
| Jul 7, 2014
Team unity pays off for a new hospital in Maine [2014 Building Team Awards]
Extensive use of local contractors, vendors, and laborers brings a Maine hospital project in months ahead of schedule.
| Jul 7, 2014
A climate-controlled city is Dubai's newest colossal project
To add to Dubai's already impressive portfolio of world's tallest tower and world's largest natural flower garden, Dubai Holding has plans to build the world's largest climate-controlled city.
| Jul 7, 2014
How to keep an employee from jumping ship
The secret to keeping your best employees productive and happy isn’t throwing money at them, as studies have continuously shown that money isn’t the top factor in employee happiness. Here are four strategies from leadership coach Kristi Hedges. SPONSORED CONTENT
| Jul 3, 2014
Gehry edits Canadian skyscraper plan to be 'more Toronto'
After being criticized for the original tower complex, architect Frank Gehry unveils a new design that is more subtle, and "more Toronto."
| Jul 2, 2014
First Look: Qatar World Cup stadium design references nomadic heritage
Organizers of the Qatar 2022 World Cup, the Supreme Committee for Delivery and Legacy, recently unveiled designs for the second stadium.
| Jul 2, 2014
SHoP designs what would be Brooklyn's tallest building
JDS Development partners with SHoP to construct a 70-story building at 775-feet tall, unprecedented for downtown Brooklyn.
| Jul 2, 2014
Grimshaw's 'kit of parts' design scheme selected for Qatar sports facilities program
The series of projects, called the Al Farjan Recreational Sports Facilities, have been designed in such a way that the same basic design can be adapted to the specific requirements of each site.
