The biggest concern during COVID-19? Businesses that collapse after the lockdown measures are relaxed

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The federal government and its provincial counterparts have introduced emergency relief measures to protect individuals and businesses during COVID-19.  All of them were understandable and necessary on a short-term basis.

That being said, most Canadian politicians would agree with former Ontario premier Bob Rae’s May 7 statement on CBC News Network’s Power & Politics that “no government is an ATM machine.”  The private sector needs to gradually rebuild itself, and the free market economy must be allowed to thrive once more.

It’s not going to be easy, but it has to be done.

Some restaurants and retail stores have been able to use delivery services, takeaway options and curbside pickup to offset some potential losses the past couple of months.  As each province relaxes its lockdown measures, more will be able to take advantage.

Not a moment too soon, in fact.

Alas, there’s another issue that’s creeping in.  While many Canadians are concerned about businesses closing during COVID-19, I would suggest they’re missing a much bigger piece of the puzzle.  What we should be most worried about is businesses that re-open after the lockdown measures are relaxed – and collapse shortly thereafter.

An early indication of this coming financial onslaught was detected in a March 30 survey of 9,678 members of the Canadian Federation of Independent Businesses.

Roughly 32% of CFIB respondents said they “are unsure whether our business will reopen” after the COVID-19 emergency is over.  Moreover, 42% feared they would have to “close my business permanently,” and 25% believed they could only last less than 2 weeks (6%), or over 2 weeks but less than a month (19%), if “COVID-19 continues to pose a serious challenge.”

Nearly two months later, it’s fair to assume these numbers have intensified – and the confidence level of business owners has continued to plummet.

Hold on, some of you may be thinking.  If provincial governments continue to relax their lockdown measures, wouldn’t this encourage many residents to return to their normal routines?

Not necessarily.

Restaurants, pubs and bars are going to be operating at half-capacity or less if they follow proper social/physical distancing procedures.  Some may follow the lead of Virginia’s The Inn at Little Washington.  According to the New York Daily News on May 14, this three-star Michelin restaurant “will maintain the image of a full house with dummies assuming the role of satisfied patrons.”

Roast beef au jus, Yorkshire pudding and mannequins by candlelight.  That’s quite the ambiance, don’t you think?

Meanwhile, some dining and drinking establishments have patios, and others don’t.  The latter group could face a huge struggle to build these temporary structures if city, town and village by-laws aren’t immediately adjusted.

Plus, are Canadians really going to want to rush back to their favourite hangouts?  They won’t go in if it’s crowded, or if it’s barren.  They won’t know whether everything is cleaned properly and continuously.  They won’t know for sure if every member of the kitchen staff, servers, dishwashers, maître d’hôtel and others are safe and healthy.

There’s enough risk when we order in food and do takeaway.  Physically going to one of these locations is a different experience – and one that many people will take a wait-and-see approach.

The same goes with sports.  Canadians aren’t clamouring to re-enter large stadiums and arenas after being in self-isolation the past couple of months.  Some professional sports leagues have cancelled or temporarily halted/delayed their schedules.  Germany is finishing up its football (or soccer) season in empty stadiums, and golf and tennis will likely do the same.  Baseball may run an entire season in two states, Florida and Arizona.  The fate of basketball, hockey and football remains to be seen.

Movie theatres will try reopening, but how many will take a chance with their health and well-being?  The same principle goes for plays and concerts of different musical genres.  Retail locations will face line-ups like supermarkets and grocery stores, and that’s something they can’t afford to have.  The airline industry has become deadweight.  Plexiglass being built in some gyms in Hong Kong will a hard sell to most patrons.

We know some businesses will never re-open during the coronavirus pandemic, but how do we protect those that are able to brave the storm?

Some people will order items online more frequently.  Some will bite the bullet and physically re-enter these locations.  Some will remain uncomfortable for months and years.

My concern is the majority will just hope that governments keep bailing businesses out.  This contributes to the existing problem, and could cause even greater harm to the Canadian economy.

It’s a huge mess, and it’s about to become even messier.

Photo Credit: TMZ

More from Michael Taube.   @michaeltaube

Michael Taube, a long-time newspaper columnist and political commentator, was a speechwriter for former Canadian prime minister Stephen Harper.

The views, opinions and positions expressed by columnists and contributors are the author’s alone. They do not inherently or expressly reflect the views, opinions and/or positions of our publication.

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