We are in the middle of a global health pandemic that is creating a looming economic crisis requiring our immediate attention.
Nearly 90% of BC residents are employed by small and medium-sized businesses. Due to Vancouver’s sky-high rents and taxes, numerous small businesses in the city were already on the brink of extinction before this crisis.
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Suddenly, many businesses face an uncertain future, as revenues have plummeted. With the exception of a few bright spots in the economy, most small businesses, especially those in the tourism, hospitality, restaurant, and entertainment sectors, have been decimated and may not be able to re-open if support doesn’t come in the next few weeks.
While recent federal program announcements are a good start, much more help is needed. Businesses forced to temporarily shut their doors still have unavoidable costs that need to be addressed, such as rent, property taxes, and debt obligations.
Deferring these costs will provide short-term relief to cash flow. However, lost revenue during the shutdown won’t return. As a result, many business owners will have to decide if the risk of increasing debt is worth incurring for an uncertain future. Some businesses have already decided “No” and have closed forever.
Now is the time for our community and all levels of government to step up and help our small businesses navigate through this crisis.
A multi-faceted approach of relief measures (for businesses that show evidence of a significant decline in business due to COVID-19) could be improved with the following temporary measures:
- Fast-track current and future federal wage subsidies
- Establish a provincial three-month rent abatement program and clarify and accelerate proposed federal program announced on April 16
- Waive (not just reduce) property taxes for the next three months
Many Vancouver residents have turned to small businesses over the years to support school and community events, sports teams, and the arts. Local businesses are continuing to help our community by shifting garment production to making much-needed medical supplies, opening rooms in hotels for Vancouver’s most vulnerable, and preparing meals for first responders.
Small businesses are a critical part of our community, and it’s our turn to help them. Vancouver residents who still have the financial means and disposable income during this time can support their local businesses by shopping online, ordering takeout or delivery meals, buying prepaid gift cards, and tipping over-worked staff.
We will get through this crisis. However, the road to recovery will be incredibly difficult, especially if many of our businesses do not survive. Ultimately, it will cost everyone more if governments have to spend on social programs to serve a growing unemployed population because businesses did not get enough support to survive.
Other cities are facing the same situation, and they will be working to support their businesses and attract new ones going forward. We must similarly have a plan to restart the engine of our local economy, or Vancouver’s economic prosperity (and the jobs that come with it) will otherwise be lost to the likes of Seattle, San Francisco, and Toronto when we get through this period.
Small businesses are the backbone of our city, and we will be very well served and have a higher probability of a better outcome after this crisis if we step up together.
We are stronger together.