Many of the companies, which employ a total of about 23,400 workers, say the funds from the Paycheck Protection Program weren’t enough to keep them going as the coronavirus and lack of additional stimulus payments weighed on their businesses.
The total number of companies that failed despite getting PPP loans is likely far higher. The Journal only analyzed the big borrowers from the program, which accounted for about half of the overall loans though only about 13.5% of the total participants. And many small businesses simply liquidate when they run out of cash rather than file for bankruptcy.
The government awarded a total $525 billion in PPP loans to 5.2 million companies since April, according to the Small Business Administration. The SBA has only released data on the largest borrowers, which the Journal linked to bankruptcy filings.
The total amount lent to companies that went bankrupt is between $228 million and $509 million—the government publishes a range for the loan amounts. Half of the 285 firms identified by the Journal have filed for bankruptcy since August. Dozens of recipients, which come from nearly every state, cited the pandemic as a primary reason for entering bankruptcy.