Great Resignation, gig economy bring a surge in new DC businesses – The Washington Post

by | Jul 16, 2022 | Business

Listen8 minComment on this storyCommentGift ArticleCall it the Great Hustle.Despite record unemployment and concerns of widespread business closures early in the coronavirus pandemic, the number of people seeking to start and develop their own businesses in the D.C. region surged, a Washington Post analysis shows.While more than 1,000 establishments in sectors including food services, construction, entertainment and wholesale disappeared during the first part of 2020 in the D.C. metro area, the number of new brick-and-mortar businesses continually increased in the next few quarters and surpassed the number that closed, Bureau of Labor Statistics data shows. That growth — much of which came in educational services, health care, construction and finance — does not include the online shops that economist say have grown as well.Covid closed downtown D.C. businesses. Many reopened — in the suburbs.Combined, the District, Maryland and Virginia saw applications for business licenses jump from about 176,000 in 2019 to 219,000 in 2020 and 262,000 in 2021.AdvertisementThe surge was a surprising byproduct of the pandemic, experts said, as new business owners emerge in an effort to supplement dwindling incomes, turn hobbies into professions or embark on new ventures.The latter was the case for Teresa Padilla and Geraldine Mendoza, who were displaced from jobs as a pastry chef and a restaurant manager, respectively, after the pandemic hit in March 2020. Their jobs were among the more than 140,000 positions in the food and accommodation industry that disappeared in the months after the pandemic began across the D.C. metro area, according to BLS data.But in the summer of 2020, Padilla and Mendoza began selling sandwiches from a Capitol Heights pop-up kitchen and a food truck, found success, and then secured their own building. In October 2020, they opened their brick-and-mortar eatery, Taqueria Xochi, a fast-casual Mexican restaurant in the District, named after the ruins of Xochitecatl in central Mexico.AdvertisementPadilla now works as the head chef and Mendoza as the operations manager. The business grew quickly, Mendoza said.“It happened unexpectedly and organically,” she said. “Thankfully, we had a lot of friends that told the city about our food through word of mouth for us. And that’s what gave us the confidence to push and to say, ‘OK, this is going to work.’ ”The local boom in business creation, experts say, could yield a spike in innovation and a shift in workplace culture, forcing companies to re-examine their relationships with workers, who have quit in waves for new jobs or to strike out on their own.“As time has gone on, we recognized that the pandemic is leading to a restructuring of the economy,” said John Haltiwanger, an economics professor at the University of Maryland at College Park. “I think we were surprised by the [application growth] because early on in the pandemic, our economy was contracting just an enormous rate — but then it started to turn around.”AdvertisementIn the pandemic’s first year, D.C. leaders expressed growing concerns surrounding the dwindling number of business license applications submitted — which would ultimately translate into less commercial tax revenue for the city.“We know that a full recovery is going to require getting the District’s businesses and owners and entrepreneurs back to doing what they do best, which is sharing their ideas and employing and serving District residents,” D.C. Council member Brooke Pinto (D-Ward 2) said in a spring 2021 committee meeting.Prince George’s County economy rebounds from pandemic job lossNew trends then began to develop. Among them: Many workers regained crucial hours in their days when they started working from home early in 2020.“The pandemic definitely allowed us the luxury of having more time and energy,” said web developer Nameer Rizvi, who lives in Ashburn, Va., but worked in D.C. “My commute to the office was two hours there and then two hours back. So to have that four hours of the day back, that definitely helped.”AdvertisementThe newfound time allowed Rizvi and his partner, Naomi-Grace Panlaqui — also a web developer — to follow up on an idea they had seeded in early 2020: an app to aggregate concert listings from across D.C.Rizvi and Panlaqui named it DC Music Live. For now, they said, they’re still freelancing and working regular jobs while tinkering with the app, which is still in its early stages and not yet profitable.The pandemic-era commute might be changed foreverExperts said the pandemic accelerated the trend of people going into business for themselves, which had been jump-started by the emergence of Etsy, Uber and Lyft. A 2019 U.S. Census report published by a team of economists reported that self-employment held a relatively stable share of the workforce for about 50 years — until a rise within the past decade.“I think that we’re seeing, in many ways, the long-anticipated rise of the gig economy,” Haltiwanger said. “I think it really took off in the pandemic, partly because we realized we could actually do it.”Gig-economy jobs and how to manage the irregular incomeD.C.’s Small Business Development Center, located at Howard University, helps w …

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