Rolling restrictions highlight precarious business positions

Mar 4, 2021

The recent series of alert level restrictions have shown just how close to the edge many businesses are being forced to operate with increasing numbers facing ever harder decisions.

EMA Chief Executive Brett O’Riley says yesterday’s highlighted increases around the number of liquidations, and feedback from EMA members during recent face-to-face meetings and briefings, highlighted how close the cliff edge was for many businesses.

"Everyone is aware of the issues facing the tourism, hospitality, accommodation and international education sectors but businesses across the board are facing or have reached the point of closure with the resultant loss of jobs and major impacts in the community," says Mr O’Riley.

"Our team was in Whakatane for our Summer Member Briefings the day of the announcement of the Whakatane Mill closure and the possible loss of 200 jobs. In a town and region still recovering from the White Island tragedy that will hit hard."

Mr O’Riley says the EMA team held briefings for almost 500 members in the Waikato and Bay of Plenty just ahead of the latest Alert Level 3 and 2 restrictions and those events and several one-to-one meetings with members had also reinforced the significant difficulties ahead.

"Our concern has always been that the scale of the problems would start to become obvious towards the end of the first quarter of this year and that’s what we’ve been seeing and hearing.

"In every case we’ve heard about, the first priority from our members has been their staff and how to keep them. For example, we’ve got members selling major pieces of equipment to help keep their business afloat but they are also planning for the worst-case scenario - they have to if they are to survive," he says.

Mr O’Riley says other issues caused by COVID-19 were also biting hard in some sectors.

"We know the aged care sector is suffering because it can’t get immigrant nurses through the MIQ facilities despite having visas. As a result one of our members has had to close admissions to its hospital care for a period of time at two of its facilities."

"An increasing number of business are losing skilled staff because they are returning home to reunite with families who can’t get into New Zealand, while skilled staff shortages continue to increase as borders remain almost closed," he says.

"And many of our manufacturers are having their problems exacerbated by international and local supply chain issues caused by COVID-19."

Mr O’Riley says seeing a plan for the future is critical to the survival of many of these businesses.

"What’s the plan for vaccine rollouts; how will that affect international travel and business; why aren’t we using saliva testing to support our borders and give peace of mind to businesses and their customers; how are we going to capitalise on our status as a COVID-19-free haven; what’s the long-term COVID-19 management plan, and where can the private sector help with its planning, resources and technological capabilities?"

"Answering those and other questions will slow the approach to the cliff edge that is rapidly approaching for too many businesses."

For more information on COVID-19 in relation to business please see the EMA’s dedicated site covid19.ema.co.nz, call AdviceLine on 0800 300 362, or the Business Helpline on 0800 500 362.

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