Businesses across the United States began shutting down in mid-March 2020, with the most widespread closures happening between March 19 and early April. The timeline moved fast: federal guidelines came first on March 16, California issued the first statewide stay-at-home order three days later, and within two weeks, the majority of states had followed. Globally, countries like the United Kingdom locked down on March 23, creating a near-simultaneous worldwide halt in commercial activity.
The Federal Signal: March 16, 2020
On March 16, 2020, the White House Coronavirus Task Force announced “15 Days to Slow the Spread,” a set of guidelines urging Americans to avoid gatherings of more than 10 people, skip discretionary travel, and stop eating at restaurants and bars. These were recommendations, not mandates, but they sent a clear message to businesses and consumers alike. Many restaurants, retailers, and entertainment venues began voluntarily closing or scaling back operations that same week, even before any state orders took effect.
State Orders Rolled Out Within Days
California was the first state to issue a formal stay-at-home order, on March 19, 2020. Governor Gavin Newsom required all residents to remain home except for essential activities, effectively closing millions of businesses overnight. Illinois and New Jersey followed two days later on March 21. New York’s order, called “New York State on PAUSE,” took effect at 8 PM on March 22, directing all non-essential businesses statewide to close in-office operations and banning non-essential gatherings of any size.
Six more states issued their own orders on March 23: Connecticut, Louisiana, Ohio, Oregon, Washington, and West Virginia. By early April, the vast majority of states had some form of stay-at-home or shelter-in-place order in effect. The speed was remarkable. In roughly two weeks, the country went from normal operations to the most sweeping business closures in modern history.
Which Businesses Had to Close
The federal Cybersecurity and Infrastructure Security Agency (CISA) published an advisory list identifying 18 sectors as essential critical infrastructure. Workers in healthcare, food and agriculture, energy, transportation, financial services, communications, water systems, law enforcement, education, and critical manufacturing were allowed to continue operating. The list was broad, covering everything from chemical plants to residential housing services.
Businesses not on that list were generally required to close their physical locations or shift entirely to remote work. The hardest-hit categories were predictable: restaurants and bars, clothing and department stores, personal care establishments like hair salons and nail studios, gyms, movie theaters, sporting venues, and places of worship. Clothing and department stores alone employed about 2.1% of the workforce, and personal care businesses accounted for another 1.1%. For these industries, there was no remote work option.
Restaurants faced some of the most uniform restrictions. By the end of April 2020, 49 states plus Washington, D.C. had prohibited on-premises dining entirely. Takeout and delivery kept some kitchens running, but dining rooms sat empty for months.
The UK and Other Countries Locked Down Simultaneously
The shutdowns were not just an American phenomenon. On March 23, 2020, UK Prime Minister Boris Johnson announced an immediate national lockdown, ordering the closure of all shops selling non-essential goods (including clothing and electronics stores), libraries, playgrounds, outdoor gyms, and places of worship. Italy had already locked down on March 9, and France followed on March 17. By late March, much of the world’s economy was operating at a fraction of its normal capacity.
When Businesses Started Reopening
The White House released “Opening Up America Again” guidelines on April 16, 2020, outlining a three-phase approach for states to follow. Before moving to Phase One, states needed to show a downward trend in cases or positive test rates over 14 days, along with hospital capacity to treat all patients without crisis care. Phase One allowed large venues like sit-down restaurants, movie theaters, and gyms to reopen with strict physical distancing, but bars were to remain closed. Phase Two permitted bars to reopen with reduced capacity. Phase Three allowed near-normal operations with standard sanitation protocols.
In practice, states moved at very different speeds. Some southern and midwestern states began loosening restrictions in late April and early May. Others, particularly in the Northeast and on the West Coast, kept strict orders in place through May and into June. By mid-June 2020, every state had lifted its ban on indoor restaurant dining to some degree, though many reimposed restrictions later in the year as case counts surged again in the fall and winter.
The Toll on Small Businesses
The federal government launched the Paycheck Protection Program (PPP) on April 3, 2020, with the formal rule finalized on April 15, offering forgivable loans to help small businesses keep employees on payroll during the closures. Demand was overwhelming, and the initial round of funding was exhausted in under two weeks.
Despite federal aid, many businesses never recovered. About 15.2% of restaurants in the U.S. closed permanently in 2020. The losses were concentrated among independent and smaller establishments that lacked the cash reserves to survive weeks or months of zero revenue. Industries that depend on in-person contact, like fitness, entertainment, travel, and personal services, experienced similar waves of permanent closures that continued well into 2021.
The full shutdown period, from the first state orders in mid-March to the loosening of restrictions in May and June, lasted roughly two to three months for most businesses. But for bars, entertainment venues, and indoor dining in many states, rolling closures and capacity limits continued through much of 2020 and into 2021.