The COVID-19 response: from direct relief to long term recovery

Small to medium enterprises (SMEs), in particular those led by women, play an important role in helping economic revival in the aftermath of seismic events such as COVID-19. International research has found that SMEs generate two-thirds of all jobs, and every dollar invested in a small business translates to $12 in the local economy. Supporting female-led SMEs has an even stronger impact – women reinvest 90% of their income in their families and communities compared to only 30-40% in men. Yet women entrepreneurs are underrepresented in the industries that receive the most government support and are underserved by traditional financing products. 

Investing in Women, an Australian Government initiative, focuses on women’s economic empowerment in South East Asia. The program through its blended finance interventions works on the supply-side constraints of capital, to promote investments into women’s SMEs. Supported by Macquarie’s COVID-19 grant – they seeded two Gender Lens Funds in the Philippines who in turn will invest in at least 6-8 women’s SMEs in the country. 

With offices in 37 cities and work in 2,200 rural counties, Local Initiatives Support Corporation (LISC) collaborates with local groups to identify priorities and challenges, formulate comprehensive strategies, and deliver the most effective support to meet community development needs on the ground. With Macquarie’s COVID grant, LISC is providing critical financial support and technical assistance to 129 small businesses in hard-hit areas across New York City, Philadelphia and Houston. 

In New York City, LISC is focusing on supporting small businesses owned by women and people of colour, many of them sole proprietors, who were left out of other relief programs. With support from Macquarie, LISC provided grants to 88 small businesses across all five boroughs. In addition, LISC recently held the Relaunch Academy, which brought together over 50 small business owners with Macquarie employees and provided technical assistance and one-on-one consulting.

Philadelphia has the largest share of small businesses in industries that were most affected by the pandemic, with about 70% of the city’s jobs represented in these industries.1With support from Macquarie, LISC is providing grants to 19 small businesses to help them rebuild and recover from the pandemic and has enabled LISC to provide technical assistance and consultancy services to entrepreneurs and small businesses.

COVID-19 has disproportionately affected landlords and low-wage renters of colour in underinvested Houston neighbourhoods. As the federal moratoriums and additional benefits have ended, renters are finding it difficult to pay rent and face homelessness. Landlords are in turn having trouble paying their mortgages and operating expenses. With Macquarie’s funds, LISC is helping 22 property owners stabilise their properties and maintain affordable housing for those most in need. 

The small business program underscores the importance of providing ongoing technical assistance (TA) to small businesses so they can sustain their operations into the long-term. 

Australians under the age of 25 experience the highest levels of unemployment in the country, and there are expectations that COVID-19 will worsen this trend.

White Box Enterprises is a Queensland-based charity that aims to create new pathways for young and disadvantaged job seekers, creating thousands of new jobs in social enterprises by 2030. Macquarie’s COVID grant is covering White Box’s costs in raising finance to scale and support social enterprises that have the potential to employ more than 50 people.

White Box is also using a portion of Macquarie’s grant to develop a proposed Payment by Outcomes contract with the Australian Federal Government. If this pilot program is approved, jobs-focused social enterprises will be funded for every job they create that supports long-term unemployed and disadvantaged people to remain in award wage employment at 52 weeks and beyond.

Since 2019, White Box has helped facilitate the creation of more than 200 jobs across eight social enterprises.

Local communities in London are facing a complex set of issues, exacerbated by COVID-19. Many organisations are experiencing not only loss of income but also increasing need for services. 

To support these organisations in responding to the needs of London a coalition of 67 funders have come together to provide coordinated funding to organisations responding to the challenges faced by pandemic. The London Community Response Fund (LCRF) allows organisations to access grants from multiple funders efficiently, enabling them to provide vital support to communities faster.  

Macquarie’s grant is supporting LCRF’s second to fifth wave of funding, focused on supporting the recovery and renewal of London’s communities over 12 months. It will provide grants which can be used to build projects, support operating costs or take a partnership approach. The Fund has taken an equitable approach, aiming to award at least 70% of grants to organisations led by the BAME, LGBT+, deaf and disabled communities, or women.