The largest share of billions of dollars in forgivable federal loans handed out in Pennsylvania, New Jersey and Delaware amid the first wave of the COVID-19 pandemic didn't go to local restaurants and bars, or health providers and cultural institutions.
The sector that received the most, by far, is made up of white-collar businesses like law firms, research companies and technology consultants, according to federal data released this month analyzed by NBC Owned Television Stations.
Thousands of companies in Pennsylvania and New Jersey that are part of what is officially described by the federal government as the "professional, scientific and technical services" sector roughly $7 billion in forgivable loans through the Payroll Protection Program, the analysis shows.
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That amount far exceeds any of the other sectors of the economy. Here is a look at the breakdown by state:
Tens of thousands of small businesses, defined as having less than 500 employees, received federal PPP loans in April and May through the federal stimulus in response to the pandemic.
In total, companies self-reported that the PPP loans would save more than 2 million jobs in Pennsylvania, New Jersey and Delaware, according to the federal data provided by the U.S. Treasury and Small Business Administration.
It is not clear how accurate the jobs figures are, however. Thousands of the businesses and nonprofits in the database have "jobs retained" entries that include either 0 or "not available."
Businesses who received the PPP loans are required to use at least 60% of the federal money they receive on employee payroll in order to have the loan forgivable. Otherwise, the loan must be repaid at a low interest rate.
Pat's King of Steaks was listed with a 0 for jobs retained. The steak shop's owner, Frank Olivieri, disputed that number when reached for comment earlier this month.
"I definitely took it to aid me in paying my employees," he said. "We had before the COVID outbreak 26 to 27 employees. Before we got our PPP loan, we were down 65-75% business at the window, so we had employees voluntarily go on unemployment. I didn’t lay anyone off. But with paying the 17 to 20 employees that remained, I am benefitting from the loan."
He says he doesn't know why his business has a 0 jobs retained next to its name. Messages left for comment with the Treasury Department have not been returned.
NBC Owned Television Stations also grouped businesses that received PPP loans by zip code across the entire Philadelphia region. Some of the areas with the highest number of loans are in the Philadelphia suburbs and central New Jersey.
The $350 billion program was approved by Congress as part of the $2 trillion CARES Act, the stimulus package initiated to help prop up the economy during the initial wave of the COVID-19 pandemic. All businesses and nonprofits with less than 500 employees were able to apply for a loan of up to $10 million. The loans were seen as a lifeline for millions of jobs because the federal government will forgive them if companies follow certain criteria in how the money is spent.
Uncertainty in the data so soon after the program was created and the money was doled out to hundreds of thousands of businesses isn't surprising, according to Samuel Rosen, an assistant professor of finance at Temple University's Fox School of Business.
Rosen, who has co-authored an analysis of public companies that received the PPP loans, said it will take months, if not years, to determine the full impact of such a massive government lending program.
"There isn’t a modern equivalent to this type of borrowing program," Rosen said.
"I wouldn’t be surprised if there is a lot of data integrity issues or problems with the reporting," he added.