Out of COVID’s Challenges, Nevada Developed a Resilient Small-Business Community – Las Vegas Sun News

In the crucible of the pandemic, while many businesses in Las Vegas were shuttering their doors, one venture was taking its first steps into the frenetic world of healthcare. Upbeat Health, nestled in Summerlin, emerged not just to survive but to thrive, braving the odds. Today, its mobile wound-care team has burgeoned almost tenfold since its inception, symbolizing how Nevada’s entrepreneurs transformed crisis into opportunity.

Recent research from the UNLV Center for Business and Economic Research highlights a remarkable surge in small businesses in Nevada, which created an average of 1.7 small-employer businesses per 1,000 residents between 2019 and 2022. This figure ranks Nevada third in the nation for small business creation. Andrew Woods, director of CBER, notes a silver lining in these statistics: many of the businesses birthed during the pandemic are still operational, like Upbeat Health, which has grown from a modest team of four to a thriving group of 30.

“Our health care has definitely changed. I think (Las Vegas) is a growing city,” said Jennifer Dao, director of operations at Upbeat. She believes the clinic’s diverse range of services, five to six in total, is a reflection of the city’s development and the evolving demands of its population. This adaptability has helped cement Upbeat’s place in the fabric of Las Vegas healthcare.

According to the UNLV paper, the expansion of small businesses played a crucial role in Nevada’s recovery from the pandemic. Jinju Lee, CBER’s associate research director, points out that this progress is not just anecdotal — it showcases a diversification of the economy. While large businesses traditionally dominate the landscape, small employers now account for 45% of jobs in the state, marking a significant increase from 2019.

What’s particularly fascinating is that small businesses bounced back quicker than their larger counterparts, recovering from pandemic disruptions by 2022. This trend stands in stark contrast to the aftermath of the Great Recession of 2008, when small business listings plummeted, reflecting a much grimmer economic landscape.

So, what accounts for this resilience? Woods attributes it to a unique convergence of factors: widespread job loss fueled an entrepreneurial spirit, bolstered by a government that mitigated business risks through stimulus programs and relief measures.

Businesses like Upbeat Health, while operating without direct government support, benefited from a broader economic rebound fueled by consumer confidence and increased discretionary spending. “People wanted to get out. People had excess savings — they were willing to spend a lot of money,” Woods explained, illuminating how these dynamics propelled small businesses to not just survive, but flourish.

Additionally, the advent of remote work offered new entrepreneurial prospects, spurring many to kickstart businesses with the potential reach of entire markets, rather than being confined to local clientele. The surge in e-commerce during the pandemic has only heightened this trend, indicating a shift in consumer habits that continues to evolve.

Nonetheless, while the growth of small businesses is promising, it doesn’t directly equate to improved financial conditions for all. The UNLV paper notes that many small firms treated as ‘nonemployers’ — those run solely by individual operators, such as gig workers for companies like Uber or Lyft — have been significant contributors to the state’s growth. A sizable 27.1% of the growth from 2019 to 2022 in the state stemmed from this sector, highlighting the precarious nature of such employment.

Woods remains cautious, emphasizing that the stimulus-driven support during the pandemic shouldn’t be viewed as a replicable model for future economic strategies. He reflects on the importance of watching how these newly established businesses perform in the long run, hoping that a fraction of them will scale into larger, more stable enterprises that can drive further diversification in the Nevada economy.

The true potential for economic diversification hinges on nurturing these emerging businesses into successful entities capable of competing on a larger stage, thereby reducing the state’s reliance on its historically dominant leisure and hospitality sectors.