In the small East Bay city of Clayton, a few miles east of Concord, a silent crisis is unfolding as businesses struggle with inflation, financial instability and the lingering economic effects of the pandemic.

The secluded town of just over 10,000 residents once had busy streets lined with thriving shops, boutiques and restaurants. But now it bears the scars of economic decline as “For Lease” signs hang in windows, and distress settles over the business owners.

“Things are really tough right now,” said Michelle Perado, owner of Milk Tea Lab, a once-popular spot for local teenagers. “It is extremely stressful because rent here in this area keeps rising.”

As a result, she said, “We are only able to maintain three other employees on our staff. It’s heartbreaking.”

National economic indicators point to a recovery from the pandemic’s worst impacts. But the narrative is different for small business owners like Perado, who face a unique set of challenges including the region’s cost of living, skyrocketing commercial rent prices and a workforce that is increasingly moving away. 

According to Tara Lynn Gray, director of the California Office of the Small Business Advocate (CalOSBA), which supports the state’s small businesses and nonprofits, the Biden-Harris administration’s American Rescue Plan fueled small business growth in California in 2023.

“This remarkable rise in new businesses has the potential to reverse decades of stagnant business application numbers, opening up opportunities for job creation and prosperity,” she said.

By contrast, many small businesses in Clayton are still having a difficult time. 

“I have found myself struggling to stay afloat,” said Doug Liu, owner of R&L Jewelers, another local business in town. 

“Even the people who pass through here do not feel the need to stop by,” Liu said, and “without the consistent foot traffic here, sales have plummeted.”

Liu says he and others in this small East Bay community may have no choice but to adapt to an ever-changing economic environment.

“I would love Clayton to become more of a hotspot for Bay Area residents,” he said. 

“We’re not giving up,” he added, his voice filled with determination. “This is our community. We’re going to keep fighting for it.”