Local business community feels government supports package needs enhancements

Tuesday, April 14, 2020

The Windsor Star/Dave Waddell

 

https://windsorstar.com/news/local-news/local-business-community-feels-government-supports-package-needs-enhancements/

 

A survey studying just how hard and fast the COVID-19 pandemic has hit the local economy shows nearly 93 per cent of businesses felt an immediate negative impact with 73 per cent urging the government to make bigger stimulus investments.
 
As of last week, 268 of the 575 respondents to the Windsor-Essex Economic Development Corporation COVID-19 task force survey had temporarily shut down their businesses.
 
The survey was conducted between March 22 and April 8 and will be repeated in a month.
 
“The most important thing is the scale of the impact,” said Windsor-Essex Regional Chamber of Commerce president and CEO Rakesh Naidu.
 
“At no other time in the recent past has something affected such a large chunk of businesses at the same time. Even World War II, recessions, downturns in the auto cycle — some clusters were affected more than others.
 
“It’s the first time an impact has been so deep across every sector. It’s startling.”
 
The survey results will be used to help local organizations address current issues and plan their strategy for the future recovery.
 
It will also be shared with provincial and federal government officials to help them track the success of the supports that have been introduced.
 
The survey revealed 57.4 per cent of area businesses have laid off employees temporarily and 28.2 per cent have issued permanent layoffs.
 
“That figure of 28 per cent permanent layoffs concerns me,” said WEEDC president and CEO Stephen Mackenzie. “That’s something we’ll have to keep on eye on.”
 
For Workforce WindsorEssex CEO Justin Falconer one of the key messages from the survey is more government supports are required.
 
“Nearly 75 per cent of businesses said it’s extremely important the government introduces a bigger stimulus policy,” Falconer said.
 
“We’ve just had the largest stimulus plan since World War II and business still thinks it should be larger. That tells you how big a crisis business is in.
 
“Fortunately the feds have acknowledged they have more fiscal firepower and more phases of help to be rolled out.”
 
There was also a split on the satisfaction level among businesses over the government’s early initiatives.
 
There were 150 businesses that were somewhat or very satisfied with the federal government programs while 141 felt the opposite. One hundred twenty two respondents were neutral on the plans.
 
Similarly 132 businesses moderately or strongly approved of the province’s supports while 156 felt the opposite. There were 125 respondents who were neutral.
 
“This may be a case of the survey being done while these programs were just being rolled out,” Mackenzie said.
 
“It’s our job to make sure people understand and apply for these programs. We need to see those numbers move in the right direction.”
 
Naidu said cash flow problems for businesses and the uncertainty of future revenue streams are going to require governments to move away from interest-free loan programs.
 
“I think in the coming weeks we’ll see more grant programs,” Naidu said.
 
“Business are reluctant to take on more debt when they don’t know their future revenues. It makes loan programs more ineffective.”
 
Naidu added businesses are seeking help on lower WSIB and auto insurance premiums, opening up the Canada Emergency Business Account to smaller companies, rent support and relaxing the rules further on the Canada Emergency Response Benefit to include more workers.
 
A bright spot in the survey was 245 businesses still hadn’t laid off any employees.
 
Mackenzie acknowledges that figure could have been significantly altered in the past week.
 
“I think it shows businesses are doing whatever they can to support their employees,” Mackenzie said. “Unfortunately this will be difficult to sustain.”