Illinois gains small businesses, but restaurants still slow to rebound

This Small Business Saturday, Illinois has more entrepreneurs than before the COVID-19 pandemic. But the recovery has been uneven as some types of small businesses struggle and many jobs are missing as Illinois lags the national rebound.

Illinois has more than 1.6 million small business owners, a growth of 138,000 new entrepreneurs since 2019, but the bad news is it lost 21,174 bar and restaurant owners.

Adam Arbil survived the odds.

“I opened Zayna Mediterranean Grill in August 2019. ‘Zayna’ is my grandmother’s name,” Arbil said. “We opened right before the pandemic, so business was doing well, but the pandemic was a difficult time.”

As Illinoisans remember to shop small Nov. 27 on Small Business Saturday, they can also do some local good by eating small at places such as Arbil’s restaurant in Chicago’s West Loop. Small businesses drive Illinois’ economy, with 70% of Illinois net job growth from 2011-2019 created by businesses with fewer than 50 employees.

Women and Black business owners grew at the fastest rates, with 13% more women launching small businesses and Black business owners more than doubling since prior to the pandemic. Women and Black Illinoisans lost jobs at the fastest rates from COVID-19 shutdowns, so many turned to being their own bosses to feed their families.

Male small business owners have increased by 7.3%, about half the rate of women entrepreneurs. Businesses run by white non-Hispanic owners have increased 2.6%, while there’s about the same number of businesses run by Hispanic owners as before the pandemic.

While the number of small businesses in Illinois is growing, owners are employing fewer workers.

The bar, restaurant and food service industry has 87,900 fewer jobs than before COVID-19. Small retail businesses have grown 41% since 2019,  yet the sector still has 16,300 fewer jobs than before the pandemic.

“At some points, I would work two or three positions at the same time to keep the business alive because it was difficult to bring on staff,” Arbil said. “The online and delivery orders helped sustain us, and I was able to bring on more staff. I’m very thankful to have made it this far.”

Despite growth in self-employment across Illinois, finding a job is still challenging. There are 286,700 fewer jobs in the Illinois economy than prior to the pandemic. Illinois’ unemployment rate is also among the highest in the nation at 6%, leaving 370,400 Illinoisans out of work.

“I hope and plan to keep growing the business. I would love to add Moroccan dishes to the menu or open a second location with Moroccan and Mediterranean food. I also would love to open a location or café in my hometown in Morocco after establishing this business here as a family legacy,” Arbil said.

While consumer demand is on the rebound, supply chain and labor shortages further complicate the return to normal for small business owners. A record number of Americans have quit their jobs in recent months, leading to a nationwide labor shortage. Coupled with the rising cost of business inputs, inflation now threatens to hamstring small businesses who are often more tightly strapped for cash and have less flexibility to overcome financial hurdles.

But Illinois’ small business owners are inventive and resilient. Nov. 27 is a chance to show them appreciation for their roles creating jobs and boosting their communities.