COVID-19 has been the defining force of 2020, transforming lives the world over. Beyond its health effects, COVID’s economic effects have been similarly devastating. As many businesses closed their doors, reduced staff, or shut down entirely, global unemployment soared.
Amidst this economic fallout, at Looka we’ve noticed an interesting side-effect: an increase in entrepreneurship. As lockdowns struck and unemployment rose, the number of people building businesses skyrocketed. Like the Great Recession, the economic uncertainty from COVID-19 has motivated many to take their career into their own hands.
As a logo maker and branding platform, Looka serves thousands of early-stage entrepreneurs every week. In early 2020, we saw those numbers begin to increase dramatically. To understand the story behind this shift, Looka set out to research the trends and causes of entrepreneurship spurred by COVID.
To track trends in entrepreneurship during COVID-19, a combination of methods was used which you can read below.
- Searches performed in Google: search volume data for over 100,000 terms related to logo design, including “logo maker”, “logo creator”, and “logo generator”
- Year-over-year (YoY) weekly comparison: 2020 week-by-week search volume for these terms, as compared to 2019 week-by-week search volume
- Between January 1, 2020 and November 24, 2020, the US experienced an average increase in logo-related searches of +21% YoY
- Between February 26, 2020 and November 24, 2020, the average search increase is +24% YoY
- Weekly revenue: Looka’s weekly revenue from logos sold in 2019 compared to 2020
- Countries: The country of focus was the United States, with additional data on Italy, Spain, France, United Kingdom, New Zealand, and Germany included for global context
- Major events related to COVID-19: Events considered included lockdowns, closures, openings, and unemployment announcements
U.S. Key Findings
On February 26, the first case of COVID-19 with no clear source of exposure was found in California.
During the week of March 25, a record 6.6 million Americans filed for unemployment benefits.
In the week of April 1, another 6.6 million Americans filed for first-time unemployment, bringing the total claims to 16 million. This week also saw the U.S. searches for terms related to logos up +2% YoY from 2019.
The week of April 22 saw logo-related searches +28% higher than 2019. That same week, the national unemployment number hit 30 million, which meant 18% of the U.S. workforce was unemployed.
In the week of May 6, 3 million more Americans filed for unemployment—raising the total to 36.5 million over the past eight weeks. This same week, search reached a +33% increase from 2019. Sales also began to lift, with a +10% increase in revenue compared to the same week in 2019.
As restrictions loosened across states, searches and sales continued to increase. In the week of May 13, search reached a +36% YoY increase and sales a +27% YoY increase. The following week saw a +32% YoY search increase as well as a +32% YoY increase in sales. These two weeks also saw unemployment numbers attributable to COVID reach over 40 million.
In the week of May 27, first-time unemployment claims dropped to 1.8 million, a sign that the economy might be on the road to recovery. The Bureau of Labor Statistics also reported the U.S. economy gained 2.5 million jobs in May, while the unemployment rate dropped to 13.3%—compared to 14.7% in April.
Even as the economy improved, interest in entrepreneurship stayed strong, with a +29% YoY increase in search and a +32% YoY increase in sales the week of May 27.
This month also saw U.S. employers add 1.8 million jobs, bringing the unemployment rate down to 10.2%. However, compared to June—which saw a record 4.8 million jobs added—July’s rate of job growth was dramatically slower than the previous month.
Search rose again in July, peaking at +48%YoY and staying above +40%YoY for the entire month, only dipping to +41% YoY in the week of July 29. In line with these search trends, sales of logos remained high compared to the previous year, with a +45% YoY increase in the week of July 22.
U.S. job growth continued to slow in August, with only 1.4 million jobs added. Still, unemployment continued to fall, from 10.2% in July to 8.4% in August.
Even as jobs continued to be added, some 29 million people were collecting unemployment benefits by mid-August. It’s worth noting that this number also covers self-employed people and gig workers, who are not part of the monthly payroll.
Despite job gains over the past few months, consumer confidence remained low, as consumer spending grew just 1% in August. Conversely, demand for logos was once again up from 2019, seeing a peak increase of +34% YoY in the week of August 19.
This YoY increase in spend was matched by a continued search interest in logo-related terms. While slightly lower than July, search remained strong, starting at +35% YoY in the week of August 5, dipping down to +29%YoY the week of the 19th, before rebounding to +32% YoY the week of August 26.
Compared to both July and August, job growth dipped dramatically in September, with only 661,000 new jobs added. Again, unemployment fell slightly from 8.4% to 7.9%, and the number of people collecting unemployment benefits declined to 26 million in mid-September.
In September, the sale of logos jumped, and in the week of September 16, reached a +58% YoY increase as compared to 2019. This increase may have been a delayed result of earlier increases in search, as September saw the YoY increase in search begin to level out.
With a high of +32% YoY the week of September 16 and a low of +22% YoY the week of September 30, September’s search increases looked like the more modest ones seen in spring.
This month also saw a further slowdown in economic recovery, as only 638,000 jobs were added to the U.S. economy. As unemployment reached 6.9%—less than half of the 14.7% seen in April—the economy still showed the deep marks of a pandemic-triggered recession. With only 54% of the 22 million jobs lost abruptly in the spring of 2020 recovered, the slow job gains of the past few months had only made a small dent.
If September was the beginning of an increase in demand, October accelerated that trend, as the weeks of October 14 and 21 both saw +69% higher sales than the previous year.
Again, the YoY increase in logo-related searches continued to slow in October, suggesting that purchases this month came from those people who had been searching for logos earlier in the year. Beginning the month at +25% YoY and ending the month at +17%YoY, searches were still higher than in 2019, but not in proportion to the YoY increase in sales.
Again, the increase in search continues to level out, with both the week of November 4 and the week of November 28 seeing only a +14% YoY increase in logo searches. It’s important to note that the week of November 4 was directly following the US election. The uncertainty of the weeks following the election likely dampened interest in entrepreneurship.
As winter approaches and the previous flood of searches fades, logo sales can be expected to decrease as well. But with the second wave taking hold and more businesses closing, there may be a revived interest. However, for now, the colder months may be tempering some of the optimism felt earlier in 2020.
Understanding COVID-Related Entrepreneurship
At the start of COVID-19, as many countries were going into lockdown, Looka’s traffic and sales dropped. When we saw our numbers start to rise again in April, we wanted to understand why.
To help new entrepreneurs and understand their experiences, we offered free logos to people who had lost jobs due to COVID-19. This program also let us ask about their motives.
For many, the answer was necessity. They needed to work and companies weren’t hiring. For others, COVID-19 was an opportunity. As demand for reusable masks and grocery delivery grew, some saw a gap in the market. Still, others saw side hustles as a way to stave off quarantine boredom. Whatever the cause, these trends speak to a larger sense of perseverance, even in the face of uncertain times.
The growth in search trends for logo-creation related keywords was seen on a global scale as well. Below is a snapshot of the ballooned interest in logo generation that COVID-19 accelerated for entrepreneurs and small business owners.
- Large Scale Restrictions #1: March 9
- Large Scale Restrictions #2: November 6
- Peak Search: +158% YoY increase in the week of April 22
- Peak Sales: +480% YoY increase in the week of May 13
- Large Scale Restrictions #1: March 14
- Large Scale Restrictions #2: October 25
- Peak Search: +108% YoY increase in the week of April 15
- Peak Sales: +355% YoY increase in the week of June 10
- Large Scale Restrictions #1: March 17
- Large Scale Restrictions #2: October 30
- Peak Search: +63% YoY increase in the week of April 15
- Peak Sales: +358% YoY increase in the week of June 17
- Large Scale Restrictions #1: March 23
- Large Scale Restrictions #2: October 31
- Peak Search: +92% YoY increase in the week of April 15
- Peak Sales: +112% YoY increase in the week of June 10
- Large Scale Restrictions #1: March 22
- Large Scale Restrictions #2: November 2
- Peak Search: +94% YoY increase in the week of April 15
- Peak Sales: +427% YoY increase in the week of April 22
- Large Scale Restrictions #1: March 23
- Large Scale Restrictions #2: August 14
- Peak Search: +140% YoY increase in the week of September 16
- Peak Sales: +402% YoY increase in the week of September 30
- Large Scale Restrictions #1: March 17
- Large Scale Restrictions #2: November 23
- Peak Search: +54% YoY increase in the week of June 24
- Peak Sales: +122%YoY increase in the week of October 28
If you are an entrepreneur starting a new business during COVID-19 we’d love to hear your story! Reach out to our customer support team and tell us about your business by clicking the speech bubble at the bottom-right corner of your screen.