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Business/Economy

Nail Salons Reopen Amid COVID-19, But The $8 Billion Industry Struggles To Survive

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Mod Nail Lounge
At Mod Nail Lounge near SMU, the business uses masks, gloves and table shields to protect customers and workers.

After a nail-biting two months of the coronavirus shutdown, Emma Nguyen, the owner of Q Nails & Spa in Richardson, was finally able to reopen her store — but the return of her salon was only the beginning of her worries.

Other North Texas nail salon owners are facing mounting financial pressure as they navigate the economic downturn. They’re doing what they can to stay afloat, leaning on each other for advice and support in this close-knit network. But as the industry looks ahead, the pandemic is highlighting the need for change in the industry — for the health and well-being of both workers and businesses owners. 

Mai Duong, co-owner of Mod Nail Lounge near SMU, said the two month shutdown was a huge shock, and then came the task of reopening. 

“It has been a huge challenge, just trying to reopen and following all CDC guidelines has been a setback as well,” she said. “With every staff, we can only have one customer and trying to book that and hoping our customers understand all the guidelines we have to follow.”

Both entrepreneurs said business has fallen to 40-50% of what it was before the pandemic hit; and those numbers have declined since their first weeks of opening. In order to follow health protocols, they’ve had to cut back on staff, reduce their number of clients and spend more on expensive protective gear. 

They represent the skyrocketing number of small business owners who are struggling to survive through the recession. There were almost 31 million small businesses in the U.S., employing almost 60 million workers, according to the most recent annual government estimates

A Goldman Sachs study found that over 50% of small businesses surveyed said they couldn’t continue operating for more than three months under the current conditions. 

Nguyen and Duong are also part of a larger story about how an $8 billion industry was built by Asian women refugees. In the thick of the pandemic, this community is struggling to keep the industry they built alive.

It would be “such a shame” to lose the story of how refugees and immigrants built this business empire, says Saba Waheed, the research director at the UCLA Labor Center.

The Face Of An Industry
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“I think one of the most telling things about the nail salon industry in the U.S. is the face of who runs and works in the salons,” Waheed, lead author on the 2018Nail Files” report about nail salon industry and workers, said. “So it’s owned and staffed primarily by immigrants and refugees.” 

The nail industry’s workforce is roughly 81% women and 79% foreign-born. Further, the report shows 74% of foreign-born workers are from Vietnam. In nail salons across the country, these numbers ring true — like in Nguyen’s Richardson store where 13 of her 15 nail technicians are Vietnamese. 

The demographics of the industry matter, Waheed insists.

“They’re mothers and daughters and immigrant women and they depend on this livelihood and for basically for the salons to have shut down as quickly as they did, a lot of these workers didn’t have the recourse,” she said. 

The economic fallout also has a ripple effect for their loved ones. The study found that most nail salon workers support family members. A third are the head of the household and 61% have a child at home. 

Nail salon technicians and owners are also a part of groups that have been the most financially hard-hit by the pandemic. Job losses have disproportionately affected women of color, especially low-wage workers like nail salon technicians.

These issues hit close to home in Dallas and Harris counties, which rank among the top 10 counties in the country with the largest percentage of nail salon workers. And from a statewide perspective, Texas claims the second highest number of nail salon workers in the U.S. after California. 

Financial Burdens

For nail salon owners in the metroplex, rent has become a looming concern. Nguyen said after reaching out to her landlord in early March, she was allowed to delay her payment. Duong said her landlord waived her rent for April. They consider themselves lucky, even as they face future rent payments. 

The cost of expensive protective equipment like table/face shields and cleaning supplies are also adding to the burden of reopening. CDC guidelines require nail salons to disinfect all high-touch surfaces and to use fresh disposable gloves and smocks after every customer. Nguyen said it’s a hefty price to pay for safety, but it gives her peace of mind.

“I’m still willing to pay more for table, glass shield...I think I need that for the customer to feel safe and the employee too,” she said. 

With increased costs and a continued drop in profits, business owners know they have a tough road ahead. These worries have led Nguyen and Duong to spend a significant portion of their time applying for COVID-19-related bank and federal loans.

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Credit U.S. Small Business Administration
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U.S. Small Business Administration
New programs under the CARES Act which help support small businesses and workers.

In response to the economic decline caused by COVID-19, the federal government is offering $367 million in relief to small businesses and workers under the CARES Act. According to the Washington Post, roughly 70% of small businesses have applied for a loan under the act. 

Nguyen said she navigated the loan application process with support from a Facebook group for Dallas Vietnamese nail salon owners, which she joined a few weeks ago. 

“When we have some problems or something or some issue, we ask and we share the information,” she said. “Like I said, my English is not well so they help me... and then sometimes in the new rules of the state.” 

She applied for a Small Business Association loan with her local bank and received a loan advance of $10,000 in seven days. But she’s still waiting to see if her Paycheck Protection Program application, part of a loan forgiveness program for businesses that retain employees, will be approved. 

Duong found her own way to navigate the application process for a PPP loan: A driveway strategy session with fellow North Texas nail salon owners. Spread six feet apart in their lawn chairs, she said the circle of friends pulled out their laptops and talked through the applications. Still, she and her husband got denied the first time and had to reapply, making it roughly a month-long wait to receive aid.

“It did take us a long time to understand it. You have to be extremely accurate.” she said. “So it's not like you can just take an estimate and let them know.” 

Duong said she was approved for the SBA grant, but it took her a week to fill out the application. She and her husband had to call up various companies for billing information and get the exact amount for electricity, insurance and employee salaries before they were finally approved. 

A Close-Knit Community

For some Vietnamese workers and owners in the nail salon industry, language and information barriers can limit their access to financial support. Fortunately, the Vietnamese community is close-knit with a strong network for communication. It’s helped in navigating the pandemic. 

Tiffany Hoang is the vice president of internal affairs of the Vietnamese American Community of Dallas. She said the nonprofit organization is providing translation services and disseminating important news updates to its members. 

“For a lot of Vietnamese, when they work they don’t need English-speaking everyday so like in this situation they don’t know where or how they can ask for help. That’s why we are here,” she said. 

The organization has gathered information about disaster relief and assistance programs for small businesses, and translated it into Vietnamese on their Facebook page. They’re also offering free call-in translation services and sending out the latest news like reopening dates through group text messages. 

Despite providing all these services, Hoang said she wishes the nonprofit could do more. 

“So it’s also hard on us if someone comes out and needs help with their financials,” she said. “We just have to look up the information and it depends on the situation if we can find the information that can meet their needs.”

The American Dream?

The origin story of the modern nail industry begins in the 1970s when thousands of Southeast Asian women immigrated to the U.S. after the Vietnam War. In 1975, actress Tippi Hedren helped 20 Vietnamese women resettle in the U.S. by finding beauty schools that would teach them how to do nails. As word of mouth spread, thousands of Vietnamese immigrants were able to enter the industry through networks that started with “the first 20” . 

But the success Vietnamese refugees found in the U.S. nail industry was met with a wave of xenophobia. The PBS documentary Nailed It explains how their success these sentiments led to the viewing of Vietnamese nail workers as overly opportunistic, an insidious wave of foreigners who had come to overtake a livelihood from ‘real Americans’. 

The bias against Vietnamese nail salon workers continues to this today, according to Saba Waheed, research director of the UCLA Labor Center. She said negative stereotypes devalue the work of immigrant women of color and portray nail salons as less-than. 

“Because it is predominantly an Asian women sector, you have these racialized and gendered stereotypes of Asian women with small, nimble hands,” she said. “As well as the stereotypes of these are sweatshops and it’s dirty and cheap and low-wage.” 

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Credit Jae C. Hong / Associated Press
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Associated Press
In this June 8, 2020, file photo nail salon workers hold signs during a protest in Westminster, Calif., to demand California Gov. Gavin Newsom to lift COVID-19 restrictions on nail salons.

Even prominent political leaders like California Gov. Gavin Newsom have added fuel to the discriminatory fire. In May, he claimed a California nail salon was where community spread of COVID-19 first began in the state. However, when Newsom faced backlash for his statements, he failed to provide any evidence supporting his claim. Now a nail salon industry group is planning to sue Newsom over his comment for fear that it would spark anti-Asian sentiment. 

“COVID once again has reactivated the possibility whether it’s not those same stereotypes but a backlash against a predominantly Asian workforce,” she said.

COVID-19 Leads A New Way Forward

Ironically, Asian immigrant salon workers were the ones that democratized the nail salon industry in the 1980s. They changed nail salons from luxury spas to discount walk-in businesses, making nail treatments accessible to millions of American women.

But making this popular service affordable came at the cost of their own health and financial security. These tradeoffs have been made even more apparent because of COVID-19. 

“What COVID-19 did was it already exasperated the concerns of this vulnerable workforce,” Saba Waheed, said. “There were labor concerns before COVID as well as health and safety concerns.”

Waheed said census data revealed an estimated 80% of nail salon workers are low-wage earners, which is more than double the national rate of 33%. 

“If that was a model that brought it to every strip mall and street corner, it’s also one that isn’t sustainable anymore,” she said. “We can’t go back to the way it was and let’s just open and have the same conditions there that were there before,” she said. “All that’s been made visible by COVID is that those conditions were bad.” 

Waheed said the increase in cost doesn’t have to be huge for conditions in the salon to improve. But that requires customers being willing to pay a little more — and letting go of the old way of doing things.

        View this post on Instagram                   Following all CDC guidelines to make sure we keep you and your family safe!! Ending our long night and killing 99% bacteria with our Disinfectant spray!! #modnailloungedallas #modnaillounge #nailsofinstagram . . . Please show some love and share our post. A post shared by MOD Nail Lounge (@modnaillounge) on May 8, 2020 at 9:11pm PDT

Health and safety has also long been an issue in nail salons, but they’re even more pronounced amid the spread of the coronavirus. Research shows that nail salon workers face a higher risk of cancer, pregnancy complications and respiratory issues. 

“What this COVID crisis is showing us is the pressure of health and safety and protections pushing up against extreme financial precarious conditions,” Waheed said. 

Nail salon workers have long been at risk for chemical exposure from disinfectants and nail polish. They face issues like allergies, eye and skin irritations, eczema and reproductive problems. Respiratory issues like coughing, nausea, difficulty breathing and asthma have also been documented. Given COVID-19 is a respiratory issue, Waheed said it’s important to consider the purchasing of polishes free of toxic ingredients and upgrading ventilation systems. While protective gear like masks and fans help, she said oftentimes they’re not enough.

“The salon ventilation is one of the key things to worker protection,” she said. “Ventilation was an issue with the previous conditions of the salon with just being in the salon with the various equipment and the various products.” 

But she understands these improvements take time and money. That’s why Waheed said the federal government needs to do more so that businesses have the resources to make necessary changes for the safety of owners, workers and consumers. 

“It is not enough,” Waheed said, regarding the financial support small businesses are receiving from the government. “There would need to be more levels of the kind of business loans and grants that have started.” 

Mai Duong said many of her friends’ businesses simply haven’t been able to survive the hit from the pandemic. For some salons, none of their nail technicians have been willing to come back to work due to health and safety concerns. It has meant the death of these mom-and-pop nail salons. 

“A lot of them were so overwhelmed and in disbelief, you know, and cried from their business failing,” Duong said. “They have 20 staff and nobody wants to come back. And there's no way that she can open with just herself and paying $10,000 rent, you know.” 

Duong said even as she fights to keep her store open, she’s still reeling from the shock. 

“I never thought in a million years that we would hit this pandemic and we would have been closed for two months,” she said. “I do think it's going to take us about a year two to get back to normal. You know, April and May were the busiest months for us last year and now going back into it — I mean, we're not the same.”

Got a tip? Email Elizabeth Myong at emyong@kera.org. You can follow her on Twitter @elizabeth_myong.

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KERA News is made possible through the generosity of our members. If you find this reporting valuable, in the spirit of Giving Tuesday, consider making a tax-deductible gift today. Thank you.