Photo left: Marc Edward Pace Portanier, Photo right: Marek M. Czekalla
“The situation sucks”.
This is what an employer in the tourism and entertainment industry frankly remarked after he was forced to fire four employees and place another on reduced hours.
And his experience is just one of many. In a survey conducted by Lovin Malta to assess how businesses are reacting to the coronavirus-induced economic situation, many employees and employers alike warned drastic measures are already being taken.
“I used to work part-time at the front office of a leading hotel,” someone recounted. “I have a very good relationship with my Front Office Manager and on Sunday she called me and informed me the hotel will be closing completely. All the departments will be letting go of a lot of staff.”
“My boss has already fired seven people,” another worker responded.
“At the moment, we’re only consuming paid leave until that finishes, then we are transferring to unpaid leave,” someone else said.
‘Our business has gone from great prospects for 2020 to zero overnight’
An employer in the tourism industry recounted the shock shared by many at how his business went from having great prospects in the coming months to complete disaster mode overnight.
“We have asked staff to work a 20 hour week in the hope of extending our reserves for as long as possible but since we have no idea how long it will take for tourism and human contact to begin again, we have no idea how long we need to plan for, or when things might begin to look up again,” he said.
And while tourism has undoubtedly suffered worse hits than most industries, the shock to the system has left harmful ripple effects throughout the entire economy.
For example, a freelance web developer said she had a couple of projects lined up that would have kept her going till the end of June, but these were for a bed and breakfast hotel and a luxury boat charter service, both dependent on the tourism industry.
‘I am paying everything from my own pocket’
“They both put the projects on hold,” she said. “Even if the coronavirus outbreak is controlled within a few weeks, we all know that the tourism industry will take a long while to recover. So will these projects take place once things settle down a bit? I don’t know but I don’t think so.”
An employee at a sports betting company said the mass cancellation of sporting events across the globe has made them resort to table tennis and esports to keep the offering afloat.
“We expect this to take a minimum of three months with the upside being that the summer or the latter half of it will be very busy,” he said. “If it continues for more than that layoffs would definitely follow.”
The owner of an airport transfer company said four of his biggest agents have stopped paying him due to their own financial crises.
“They said we’ll be getting paid in April for the work we did in February, and this in instalments,” he said. “Another one said to me over the phone that they have no date when we will receive the payment.”
“I am paying everything from my own pocket and I have to put everyone on late payment.”
A self-employed LPG cylinder distributor warned the crisis may have even impacted payments due by the government to him.
“The government has unlawfully stopped my payment and is not giving me a reason why,” he said. “They are acting above the courts and deciding to take the law in their own hands. I have been without income for months now, soon I wont be able to fulfil; my obligations, and leave people stranded in the middle of a pandemic. We took the case to the Ombudsman who are currently investigating.”
‘I cannot do anything except wait for the virus to end’
Two property consultants also explained that their industry has also ground to a complete halt, leaving them in complete limbo.
“Owners and clients do not do viewings anymore, meaning no sales, no commissions,” one remarked.
“My business as a property negotiator has stopped as buyers do not want to visit property and sellers do not want buyers at their property,” another said. “Therefore I cannot do anything except wait for the virus to end.”
And while several business owners have warned they are unable to pay their rent, a reality also exists at the other end for people who rely on rental income to make a living.
“I’ve slashed my rents by 50% and use the money to keep a relative in a private nursing home,” a landlord said. “I’m currently at deficit and eating into my savings.”
Meanwhile, the government’s measures to incentivise employers to keep their staff may actually be incentivising them to lay them off.
The owner of a retail store in the wedding and party planning industry said it is probably best if she sacks her only employee because that way she would get €800 in special unemployment benefits, rather than the maximum €320 she would get as a salary subsidy if she were to stay on.
“So far we have worked with closed doors for a week where we were doing some backlog work, however sales didn’t come in at all and next week we forced a week shutdown,” she said. “In in the meantime, I am looking forward to some better schemes from the government. Otherwise, I’ll have no option but to, firstly, lay off my employee and, secondly, if the landlord doesn’t help out or if the government doesn’t help out, I also risk closing my business which I started and have worked for a long 14 years to grow the way it grew. So sad.”
With businesses left groping in the dark, Cabinet will convene tonight to discuss new financial measures to help them deal with the economic fallout. Economy Minister Silvio Schembri has urged the government to be less conservative in its approach and Lovin Malta understands that he is lobbying for direct assistance to businesses to be doubled.
Prime Minister Robert Abela yesterday hinted at a significant cash injection into the private sector, stating that the government is ready to dig into its “war chest” to save jobs, even if it comes at the cost of losing the budget surplus.
Would you like to share your experience about how the coronavirus crisis has impacted your business? You can email us in confidence at email@example.com