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An Empirical Review Of The Paycheck Protection Program: Congressional Testimony

Dr. Iryna Demko, Research Associate at Levin’s Center for Economic Development, testified on the Paycheck Protection Program (PPP) at a hearing of the US House Committee on Small Business on March 16, 2022. The PPP has been one of the largest economic stimulus programs in US history. In 2020 and 2021, the SBA disbursed over $800 billion in PPP funds to help small businesses keep their employees on payroll during the COVID-19 pandemic.

Dr. Demko, whose recent research shows that in 2020, minority-, Hispanic-, and female-owned small businesses received smaller PPP loans than other business counterparts of the same size, has authored a summary of her Congressional testimony. In the paper, “An Empirical Review of the Paycheck Protection Program,” she reports that on average, female-owned businesses received 12% less per employee compared to male-owned businesses; minority-owned businesses received 11% less per employee than white-owned businesses; and Hispanic-owned businesses received 8% less per employee than non-Hispanic business owners.

She also found that larger companies displayed greater discrepancies in loan amounts. On average, female-owned businesses with less than four employees received 17% smaller PPP loans than male-owned businesses of the same size, and female-owned businesses with twenty to 500 employees received 22% smaller loans than male-owned businesses of the same size.

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