The Barbados Chamber of Commerce & Industry (BCCI) is very concerned by unsubstantiated claims published recently in the press, citing that local businesses were using the COVID-19 pandemic to make job cuts that were in the pipeline prior to the health crisis. The BCCI also notes with concern the references made to supermarkets and retail outlets.
The BCCI wishes to emphasize that there is no evidence to support the claims, which are unbalanced as they do not speak to the rationale influencing the decisions by many local businesses to effect lay-offs as a result of the impact of the pandemic on their operations. It is a reality that many businesses have been impacted by the two-month shutdown as well as the continued closure of the hospitality sector, which is the country’s largest economic engine and upon which the retail and distribution sector is heavily dependent.
While some retailers were opened during the period of the two-month lockdown, the data indicates that the retail and distribution sector continues to be impacted by steadily declining sales and revenue, with many businesses already having to cease operations. Data from a survey of members of the retail and distribution sector by the Chamber indicates the following:
• Notwithstanding a temporary increase in sales in the month of March, retailers and distributors who remained open during the curfew have reported steady reductions in revenue as high as 25% over the period April to July this year compared to the same period last year. Retailers that were closed during the curfew reported more significant slides upwards of 35% for the same period. Of equal or greater concern is the negative outlook for the foreseeable future which results from observed declining foot traffic, as high as 20% in various sectors, and extremely thin margins particularly in the supermarket sector which is wholly dependent on significant volumes generated by foot traffic and customer spend to cover overheads.
• The continued closure of critical veins in the economy, such as the hospitality sector and food and beverage sectors, and those engaged in activity to support school preparation, have all contributed to unprecedented reductions in economic activity as pipeline demand has shrunk and continues to shrink.
The BCCI wishes to underscore the importance for all stakeholders to understand the gravity of the economic situation based on the data which clearly shows continued declining revenue and high unsustainable levels of overhead costs for many businesses, particularly those which were closed during the curfew. This has had a direct impact on their ability to sustain the business modalities and structures that existed prior to the COVID-19 crisis. Overhead and other structural costs including rent and staffing levels have been reduced, resulting in physical locations being closed, opening hours being shortened and the unfortunate down-sizing of staff costs witnessed to date. These actions have not been taken with any perverse motive, which recent media comments seem to suggest, but ironically, in the interest of preserving the livelihoods of as many employees as possible by averting total business failures.
We urge and encourage responsible and informed commentary as we work together to recover from the current economic downturn. Emotive and inflammatory comments serve nothing to advance our national and collective well-being.