Jobs & Unemployment
The loans from the Paycheck Protection Program (PPP) aim to address the economic consequences of the pandemic with payroll support for small businesses. In July, the Small Business Administration (SBA) released detailed information on loan approvals through June 30. Here is what that data says about where the loans went.
Compared to first-round data, second-round PPP distributions so far have evened out the share of aid across different states. North Dakota and Washington, DC remain the places with the most loan dollars per capita overall. However, Florida and California — two states with fewer approved loan dollars per capita in round one — have received more in second-round PPP loans. These numbers come from the more recent but less detailed July SBA overview report.
Returning to loan-level data through June, counties in middle America — from North Dakota down to Texas — received the most PPP loans relative to population size. Among other factors, this might reflect a higher ratio of small businesses to people in this section of the country. These same counties have historically reported high rates of small business jobs as a share of total employment.
The data through June also shows how PPP loans varied across American cities. Out of the nation’s 30 most populous cities, Las Vegas received the most loans compared to its size, with an average of almost 3,700 loans per 100,000 people. In comparison, El Paso, Texas averaged around 1,000 loans, and Detroit averaged 700.
Since not all loans approved were equal in value, total loan counts can fall short of the full picture when it comes to overall dollars allocated to each city. While most PPP loans were smaller, the 14% of loans over $150,000 accounted for 73% of the $521 billion disbursed. That means that the distribution of big loans likely mattered more than that of small loans when it came to the final payout for local economies.
Which cities got these large loans? With certain exceptions, the distribution of loans over $150,000 resembles that of all loans. Las Vegas, Denver, and Portland are still among the highest recipients of loans per 100,000 residents, while El Paso and Detroit are among the lowest.
The data does not give a definitive answer. But according to overview reports from the SBA as well as state-level employment data from the Bureau of Labor Statistics (BLS), more PPP dollars did go to states that faced more economic strain between January and June. States with high job loss relative to their population, like Hawaii and New York, as well Washington, DC, received more PPP aid per 100 people than did states that reported fewer job losses, such as Mississippi and Idaho.
The data also sheds light on how the distribution of loan dollars compared to other factors, like coronavirus cases or the racial and ethnic makeup of a county. Among the smaller loans that were the majority, the distribution of PPP dollars was not consistent with the level of coronavirus spread within the 30 most populous counties. Take New York, where the Bronx reported the highest cumulative COVID-19 case count through June 30 and the least in PPP loans, at 3,400 cases and around $17 million per 100,000 people. In contrast, Manhattan averaged 1,700 cases and almost $121 million per 100,000. Queens, Brooklyn, and the two counties of Long Island fell somewhere in the middle.
Among other factors, this might reflect how the health and economic consequences of the pandemic, while connected, can affect different places. With reduced travel, more people staying at home, and fears about where the pandemic might spread next, even places with few COVID-19 cases can face damage to local economies. And as mentioned before, population density and small business density also vary across counties.
Looking again at the smaller loans that comprised most of those approved under the program, there were differences. Of the nation’s 30 most populous cities, Detroit, Philadelphia, and El Paso received the fewest dollars relative to their population. Two of those cities, Detroit and El Paso, count white and non-Hispanic Americans as fewer than 15% of their residents.
As highlighted before, Detroit and El Paso also received the fewest loans overall compared to other major cities, as well as fewer large loans. As the pandemic continues, with higher mortality rates for Black and Hispanic Americans, such statistics raise the potential of additional disparities when it comes to the economic fallout.
Get more facts on PPP and access to the data used in this article. Datasets are linked under "What is this data?" in the "Questions to ask" section.
The public loan-level data, which is the basis for breakdowns at the county and city level, does not give exact dollar amounts for the 13.5% of loans that were over $150,000. As a result, county and city analyses in "What states, counties, and cities got the most?" rely on total loan counts, rather than calculating dollars per capita. Meanwhile, the per capita calculations in "Did loan outcomes differ between counties with high or low COVID-19 case counts?" and "What about variation compared to demographics?" look only at the 86.5% loans that were under $150,000. Whereas high-value loans are more important for calculating total cash flow to particular areas and local economies, the smaller loans better reflect the experience of most individual people and businesses.
Additionally, the loan-level data does not explicitly identify counties, instead using zip codes and city names. Because zip codes and counties are not perfect matches, a loan from a given zip code can sometimes belong to one of several counties. To accommodate for this, loans from zip codes that cross multiple county boundaries were divided equally between those counties. Zip codes with this issue were in the minority for the top 30 counties analyzed, with just 126 zip codes affected out of a total of 3,734.
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