Retail stores across the United States have closed their doors and furloughed workers over the past few weeks as states institute stay-at-home orders to stop the spread of the coronavirus.
Experts say that many of those stores, including some well-known retail brands, will never re-open.
As the Washington Post reported, the closure of all non-essential businesses has left retailers large and small in a state of “suspended animation.” While the federal government has instituted a program offering loans to help them weather the storm, business owners have complained that the process is unclear, and major banks like JPMorgan Chase warned that they are not able to accept or process applications right away.
Even the loan program likely won’t be enough for many businesses, the report said. Citing information from Coresight Research, the Washington Post noted that more than 60,000 stores have closed in recent weeks and 1 million retail workers have been furloughed. That includes major brands like Macy’s, J.C. Penney, and Kohl’s, which told most of their employees to remain home without pay for the indefinite future.
With experts predicting that several more months of social distancing efforts would be needed in order to curb the spread of the coronavirus, the report indicated that some retail chains will never be able to recover.
“Analysts suspect the trend line will only worsen: Many of these temporary store closures are sure to become permanent as coronavirus-related shutdowns stretch into the spring and summer,” the report noted. “A number of major retailers already are operating under heavy debt loads, making it nearly impossible for them to stay afloat without sales coming in.”
Some medical experts have speculated that social distancing will need to remain in place until a vaccine for the coronavirus is created and ready for widespread use, which could take a year or more. Experts say this could be devastating for many retailers.
Brick and mortal retail stores have already suffered in recent years as online shopping has been on the rise, and there have already been some permanent closures since the start of the coronavirus crisis. The retail video game outlet GameStop, which generated controversy for initially pushing back against orders for non-essential stores to close, announced last week that it would be permanently closing 300 locations in the near future. The chain had already announced last year that this many stores would be closed as part of a larger restructuring due to lagging sales.