Industry Group Claims 10% Canadian Businesses Will Never Recover From Pandemic Hit

Canadian provinces have eased their restrictions on economic activities gradually over the past few months. So, retailers around the country have reopened and are reopening. However, some Canadian industrialists believe it is too little too late for many businesses.

Canadian Federation of Independent Business president Dan Kelly expressed his concerns about the negative effects of the ongoing pandemic on businesses while talking with Mercedes Stephenson, the host of Sunday morning TV show The West Block.

Kelly said that his organization was hearing from its members directly that approximately 10%-12% of them are doubtful that they will ever get to open the doors to their establishments as business as usual.

Why Some Businesses Would Find It Difficult To Come Back

The said fraction of businesses feels they would have to downsize substantially to keep afloat or have to declare bankruptcy, as resuming operation would not be economically feasible to them anymore. 

Extrapolating that percentage into the overall economy paints a gloomy picture, in which more than 100,000 retailers and other businesses would never get back to their feet again, leaving acres of establishments nearby main streets obsolete.

The late March and early April saw a host of businesses rendered “non-essential”, and ultimately had to shut down to minimize the spread of the deadly virus. Many businesses had to temporarily shift towards emergency manufacturing like making PPEs and masks.

Did The Government Programs Manage To Help?

These led to severe effects on the economy. The government did extend a helping hand with several help aid programs like the Canada Emergency Business Account and Canada Emergency Commercial Rent Assistance.

While these initiatives helped many businesses toiling through the worst and making it to an eventual reopening, there were many enterprises, which couldn’t obtain adequate support to weather the financial storm.

These businesses couldn’t afford usual operational costs like using the best web hosting services in Canada and so on. For many business owners, these incentive packages have proved rather discouraging to return to normal.

As Kelly points out, many business owners failed to bring their employees back to work because of social security protocols. Many workers prefer staying at home and collecting their Canada Emergency Response Benefits check.

These checks would cash for $2000 per month. All they need to do for availing this money is to show proof that they have been laid off from their jobs or have lost income because of the pandemic.

Kelly urges that people need to act responsibly so that this emergency program doesn’t backfire on the entire economy. If the situation is safe enough for work, people should come out and join the workforce.

He emphasized on the need for accountability here. If people don’t hold themselves responsible for their selfishness, it would be impossible for business owners to revive their businesses. So, entrepreneurs must find a way to inspire their employees back to work.

This is particularly crucial for business owners, who have already taken out large loans to finance their operations during such times of hardship. Goldy Hyder, the president of the Business Council of Canada makes the point.

The POST Promise

Hyder says many entrepreneurs are now staring at the face of dissolution and bankruptcy because of the costs they have incurred to keep their ventures up and running. And they did so, by making enormous amounts of debt.

While the companies and other businesses, which have bounced back in the post-pandemic economy are hiring, they are not recruiting in sufficient numbers to compensate for the job losses occurring elsewhere.

Besides, the emergence of new costs in the form of PPEs, masks, and elaborate sanitation procedures has also hurt businesses profoundly. The extra expenditure to ensure health safety has put a whole new burden on the already struggling businesses.

In order to tackle this unprecedented situation, the Business Council of Canada has launched a program named the POST Promise. POST stands for People Outside Safety Together. So, how exactly does this initiative plan on making a difference?

The program has asked all business entities in the country to maintain certain health safety standards. The longer the Covid-19 threat remains, the more difficult it would be for enterprises to regain their financial health.

So, the POST Promise outlines five safety measures to ascertain healthy business practices among the pandemic. These steps include frequent washing of hands, maintaining physical distancing, disinfecting and cleaning the workplace frequently, and minimizing respiratory releases to a minimum in public by wearing masks.

Proper implementation of this program would do wonders in restoring consumer confidence, believes Hyder. The POST Promise label would assure the customers and clients, that the business establishment is a safe source to avail necessary services

It can be compared with campaigns likes Good Housekeeping and SafeDine. The primary goal of POST Promise is to send out a clear message that the business is taking maximum precautions to safeguard its clients from the pandemic.

Businesses Can’t Expect Government Support Forever

Hyder also had high praises for the federal government to roll out the emergency disbursement plans and stressed that those initiatives have saved thousands of lives. Otherwise, there would have been a higher toll on both the economy and public health.

That said, he also points out that it is impossible for the government to fund these programs indefinitely, And even if the government had the financial means to do so, it would have brought the economic productivity to a nationwide standstill.

Therefore, Hyder urged businesses to realize that this is a stopgap solution. He also called on the government to send out a clear message regarding the fact. This is a new normal, and businesses, unlike any other entities, will have to get used to this.

He said that it is high time that the government clarified the fact that it is incapable of providing financial aid in the long run. It is a short window, and businesses must make the most of it so that they can survive in this brand new world.