COVID, Employment, and the Payroll Protection Program
The arrival of COVID-19 in early 2020 created unprecedented and overwhelming challenges for individuals as well as institutions everywhere. The rapid spread of serious infections and deaths, combined with uncertain or ineffective treatment options, created critical emergencies for healthcare institutions. Closely related efforts to contain and limit infections had ripple effects across all industries. Lockdowns and mandatory suspensions of non-essential services severely disrupted local economies resulting in discontinued services, high levels of unemployment, and lost income.
In response, community institutions and governments at all levels mobilized massive efforts to mitigate the impact of the pandemic, including efforts to shore up support for nonprofit and other key institutions caught in the middle. This included most notably health and social assistance providers who saw sudden increases in need for their services, but also increased costs to contain infections (e.g., meet disinfecting and social distancing protocols) and disruption of traditional revenue streams.
We examine two related aspects of these developments: (1) how the pandemic impacted paid nonprofit employment in Indiana in key industries and (2) the extent to which the massive Payroll Protection Program (PPP) of the Coronavirus Aid, Relief, and Economic Securities (CARES) Act appears to have cushioned the impact. For this part of our analysis, our primary focus is on how nonprofit employers benefitted from the PPP loans/grants compared to their forprofit counterparts in the same industries.