New business openings nearly match pre-pandemic levels, Yelp says
New business openings in the second year of the pandemic were only 1% lower than the year before the pandemic (2019), according to Yelp’s COVID-19 Second Anniversary Report. Demand for socially distanced/outdoor options also remains above pre-pandemic levels for restaurants and other activities.
New business openings are almost at pre-pandemic levels. In the second year of the pandemic, new business openings reached 521,926, up 14% from the first year of the pandemic. That brings new business openings roughly in line (down just 1%) with levels reported by Yelp in 2019 (the year before the pandemic).
But business openings in major cities varied. While new business openings increased nationwide, the Delta and Omicron variants led to fewer business openings in nearly all of the nation’s largest metropolitan areas, Yelp said.
Boston, Los Angeles, New York and Seattle saw the largest declines in new business openings during the Delta and Omicron waves. However, some cities, such as Atlanta, Dallas and Detroit, have managed to break this trend and multiply the openings of new businesses despite the variations.
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Demand for socially distant options remains above pre-pandemic levels. The number of Yelp users searching for businesses with outdoor seating increased 292% in the second year of the pandemic compared to pre-pandemic searches. Adoption of Yelp’s outdoor dining attribute has also increased every month since the pandemic began, reaching 25,999 in January 2022.
Consumer interest in many outdoor activities (measured by actions such as business profile views, posting photos or reviews) is also still above pre-pandemic levels. Yelp’s report highlighted pickleball, cafes, scooter rentals, outdoor movies and horseback riding as some of the biggest winners here.
And more than 12,000 businesses on Yelp have adopted the contactless payment attribute since its introduction in 2020.
Why we care. Despite inflation, bottlenecked supply chains and labor shortages, Yelp data indicates more businesses are entering local economies, which can be good for local SEO practitioners. . However, these new business openings are not evenly distributed across the country and many major cities have actually seen a decrease in openings.
Businesses that don’t offer outdoor options may want to re-evaluate as demand for outdoor seating, for example, is almost triple what it was before the pandemic. If the availability of vaccines and boosters hasn’t diminished that demand, outdoor options might just be part of the new normal.
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