60 Minutes: Small Businesses and Workers Struggling With Shutdown | Video | RealClearPolitics

60 Minutes: Small Businesses and Workers Struggling With Shutdown

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Americans who never thought they would need it are seeking unemployment benefits because of coronavirus-related layoffs. They're finding an overwhelmed system that may not meet their needs in time. Meanwhile, business owners are trying to find solutions. CBS's "60 Minutes" correspondent Scott Pelley reports:

Ten million Americans filed for unemployment in the last two weeks. That's more jobs lost than in the 18 months of the Great Recession. Those sidelined by coronavirus include business owners at the height of their success, Americans who never imagined asking for help and those who believed we would never again explore the depths of the 1930s. Coast-to-coast, the economy is in critical condition with workers idled at Boeing, General Motors, Ford, GE, Marriott and Macy's. But the largest job losses will likely come from the biggest employer of all: small business.

Melba Wilson: When I look around at my dining room of 109 people. We normally see a lot of life. Right now, I see despair.

Three weeks ago, you were lucky to get a table at Melba's in Harlem.

Melba Wilson: I started Melba's 16 years ago with money that I saved up under my mattress.

Scott Pelley: Literally, under the mattress?

Melba Wilson: Literally, under the mattress. So, I grew up watching my mother doing that. And I emulated it.

Saving, sacrifice, and Carolina cooking made Melba Wilson a hit. Now, she's laid off 24 employees. Melba's is restricted to take out and delivery, like New York City's other 27,000 restaurants, overall one of the city's largest employers.

Melba Wilson: Well, if you're looking at the bigger picture across New York, you're looking at restaurants, you're looking at nightlife and you're looking at almost a half a million people that don't have jobs, that cannot feed their families, that cannot pay their bills, that don't know where their next meals are coming from. That's despair. That's devastation.

How much devastation is estimated by economists as an eventual unemployment rate between 10% and 30%. We found the numbers would be higher if state unemployment offices were not overwhelmed.

Department of Labor recording: "All specialists are busy with other customers. You must call back this week."

Kaitlyn Reynolds: I've done that 50 times, every day, for two weeks.

Two weeks ago, Kaitlyn Reynolds was a vice president of a firm that organizes business conferences. She filed for unemployment online but discovered her last step, in New York, is a mandatory phone call.

Kaitlyn Reynolds: Fifty times a day since March 16th to get through to the contact center for unemployment to continue my claim and I have not yet been able to get through.

Guy Hillel, found the unemployment office website had crashed.

Guy Hillel: You would go two or three pages in, and it would throw you out, would tell you that-- you know, "Session is timed out." You-- then you do-- go six pages in; again, it will throw you out. "This session is timed out." You would go all the way to the end, press "submit." You press submit and it will tell you "Session is timed out."

Time ran out on the hotel where Hillel was a manager. A native of Israel, he worked in hospitality for 20 years. When his 500-room, Times Square hotel closed, he went home to his wife, two children and a new occupation: connecting with the unemployment office.

Guy Hillel: After I think ten days, I was able to submit and go to the next step, which was a phone call.

CALL CENTER: "Your call cannot be completed as dialed."

Guy Hillel: "I'm gonna try again. 606"

No one at the unemployment office is answering his call either.

Department of Labor New York Hotline: 'We are experiencing a high volume of calls at this time.'

Guy Hillel: "And, they hung me up."

His credit card company is giving him a break for 90 days. No such luck with his car payment.

Scott Pelley: What is it like, after so many years in your industry, bringing home a paycheck every week? What is it like that you're not doing that now?

Guy Hillel: It hurts your pride, in a way, you know? Sleepless night. You wake up in the middle of the night, thinking, worrying, "What will be next? How can we-- how can we get to the next step?"

Scott Pelley: Have you ever applied for unemployment before?

Kaitlyn Reynolds: Never.

Scott Pelley: How do you feel about it?

Kaitlyn Reynolds: At first I was embarrassed I've worked since I was 15. I've always put work above anything else. I've never-- I never thought I would be in a position like this where I would need to ask for help.

Scott Pelley: Are you a month away from being broke? Two months away?

Kaitlyn Reynolds: I'd say about a month. Yeah.

It may take a month or more for the largest government bailout in history to show much effect. Federally-backed emergency small business loans will become available through banks, but demand is likely to cause delay, like those calls to the unemployment office. Melba Wilson applied for a loan. Her employees are waiting.

Alysha Navarro: It was devastating. I was heartbroken, I was scared. Scared for me and scared for my daughter.

Alysha Navarro was laid off at Melba's after two years. She's single with a one-and-a-half-year-old daughter and a list of questions.

Alysha Navarro: Can I feed my family? How can I pay bills? You wonder if this last three or four months, am I gonna become homeless?

Unemployment benefits have been temporarily increased for the emergency—about double in many states. But even that leaves Navarro about $2,000 a month short.

Alysha Navarro: This month, I won't be able to pay my cable, and I won't be able to pay my phone bill.

Scott Pelley: You got the rent covered?

Alysha Navarro: Definitely have the rent covered for this month, but I don't-- I have it covered for the next two months. But after that, what do I do?

New York ordered a 90 day stop on evictions. Nationwide, foreclosures on federally-backed mortgages are delayed 60 days. Like most Americans, Alysha Navarro is expecting a one-time check of $1,200 from the bailout fund and $500 for her daughter, but those checks are likely six or eight weeks away. As Kaitlyn Reynolds found, the safety net wasn't meant to catch so many millions at once.

Scott Pelley: You know, I'm curious. Would you try the unemployment office again?

Kaitlyn Reynolds: Yeah, absolutely. Let me pull up the number.

Department of Labor recording: We're sorry. We are experiencing an extremely high volume of calls at this time.

The 'high volume of calls' is 1.3 million a day, the state office told us. It's completing 61,000 applications a day.

Like other states, New York is attempting to spread calls across different days of the week based on the applicant's last name. The state is training another 200 reinforcements, some will take calls from home.

Danny Meyer: This virus has, for me, been almost like a hurricane with no wind, or a forest fire with no flame.

Danny Meyer is among New York's most successful restaurateurs. He started the Shake Shack chain and runs 20 other restaurants.

Scott Pelley: How many people have you laid off?

Danny Meyer: We've laid off over 2,000 people by now.

Restaurant jobs are the most vulnerable in the crisis. Retail is second.

Danny Meyer: There's about 660,000 restaurants in America. you can do the math on how many human beings are actively working, producing something of real value by bringing people together, and they're out of work right now.

The math is 12 million jobs in restaurants, which Meyer explained is only the start.

Danny Meyer: Then you start to look at all the concentric circles, the people that do our flowers, the people that deliver the bread, the people who fish for our fish. We know from the farmers in the greenmarket that, if people are not gathering, and restaurants are not open, how do you know what to plant? You don't go to the trouble of planting a crop only to have it go fallow.

Factories are fallow too. Manufacturing output is dropping at the fastest rate since the Great Recession.

Michael Bednark: We employed about 120 full-time employees at Bednark Studio.

Michael Bednark owns a Brooklyn Design and Fabrication company that makes displays for retailers.

Michael Bednark: We laid off about 25% of our staff, about 30 people. We made, basically a pay-cut across the board for everyone, so a wage reduction.

His factory builds in wood, glass, metal and plastic. He has enough contracts at the moment to last about a month and a half.

Michael Bednark: We sort of just were trying to stay positive, find a way to get through six weeks. And hopefully on the other side there'd be something to do.

Scott Pelley: And you found a way.

Michael Bednark: We did.

Overnight, working with a partner, Bednark is now manufacturing gear for hospitals. The minimum pay here is $18 an hour. They're making 27,000 face shields a day. The New York Department of Health wants to buy half a million.

Scott Pelley: So you were forced to lay off about 30 people. And now you've hired how many?

Michael Bednark: We've probably hired close to 100 ourselves. There's probably about 300 to 400 people working on this project. We have truck drivers and we have-- then we have auxiliary people working on it. Every day we get a new-- a lunch served by a local restaurant. They deliver 160 boxed lunches.

Scott Pelley: A restaurant that was closed except for takeout is now delivering 150 lunches to your face mask factory.

Michael Bednark: Yeah, our goal was to-- it's basically to keep the funds in Brooklyn, keep the funds in New York. Help people help others. So, by, you know, giving them a lunch, we can employ ten, 15 people at a restaurant each day.

We actually heard a lot of stories of empathy. Alysha Navarro from Melba's cooked up one way to help.

Alysha Navarro: I study how to do homemade hand sanitizers, Lysols, homemade masks to help people who are less, who are unfortunate, and who can't afford those things. And you can make them with everyday home supplies.

Danny Meyer started a non-profit charity making grants to his most needy former employees and Michael Bednark's people are sacrificing for each other.

Michael Bednark: We had some employees offering to split their weeks. So, they'd do 20 hours and then have their counterpart do 20 hours that week just to sort of keep people working and keep people busy and keep people getting paid.

Scott Pelley: You had employees volunteer to split their weeks with somebody who was less fortunate?

Michael Bednark: Correct.

The best of these stories happened before our eyes.

Melba Wilson took an order for takeout from someone who wanted to remain anonymous. One hundred dinners to be delivered to nearby Mount Sinai Hospital. One voice on the phone joining a chorus of Americans longing for better days ahead.

Melba Wilson on the phone: I am so uplifted, first of all, by the fact that you are doing this for the medical staff and also that you are helping my employees. So, it means the world to me.

Caller: And your name is Melba? That obviously means you're the owner?

Melba Wilson on the phone: Yeah, my name is Melba, yeah, I just happen to be the owner. And thank you so much. And stay safe, may God continue to bless you. Thank you.

Caller: Yeah bye-bye.

Melba Wilson on the phone: Ok, bye-bye.

Melba Wilson: My grandmother always told us, "This too shall pass." And it's times of, when, of trials and tribulation that I lean on my faith and I lean on my spirit. I don't know how. I don't know when. But believe me, this too shall pass.



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