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What Impact Does Rising Unemployment Have For My Business?

It wasn’t too long ago when we were all asking for long weekends, a longer holiday, or just one whole day of sleep. Little did we know that the year 2020 will grant our wishes a little too literally. Take backs, anyone?

The first half of this year is beyond crazy. Nobody knew what was coming until it hit them like wildfire. COVID-19, the global pandemic, is certainly a threat to the health and wealth of humankind. It’s not only taking away lives; it’s also taking the livelihoods of many. With so many businesses filing for bankruptcy and more on the verge of shutting down, employees are feeling anxious about their jobs now more than ever.

With the economy being extremely volatile and unstable, job retrenchment is a possibility for most companies – especially those in the private sector. While the UK government is putting out their best efforts (See Uncover Wealth Radio, Episode 129 for more information about Job Furloughing Schemes and other business updates) to try and counter the debilitating effects of the Coronavirus, there is only so much they can do given budget and time constrictions.

As a business owner yourself, you’re probably wondering what this rising unemployment would mean for your company. Today, we will discuss a few possibilities that can be brought about by high unemployment rates.

High Unemployment Rates Equal Larger Candidate Pool

Let’s start our discussion with some good news. If your line of business is not heavily affected by the current world situation (maybe it’s even having the opposite effect for you, in which case you’re earning more than losing), then retrenchment may not be a problem or issue you’re trying to settle at this time. If your industry is on the winning side of the coin during a sensitive time, you may even be lacking human resources.

The good news is that you don’t have to look too hard for great talent to join your company these days. High employment rates would mean higher chances of getting ideal candidates. Many companies have frozen their hiring processes; some have even let go of people to cut-back on costs. With that said, if you’re planning to hire more capable individuals to your company, now is the best time to look.

After all, not all of us are losing to COVID-19. Pharmaceutical companies, medical and patient care, food and grocery outlets, and delivery or courier services are just a few of the many industries that are profiting from the aftermath of this global pandemic. It won’t be surprising if they’re short-staffed right now.

What’s The Bad News?

I’d like to think that the current market situation is not “bad” but rather “challenging” for SMEs (Small to Medium-sized Enterprises). Higher rates of unemployment could mean a decline in market activity. Without jobs, consumers are less inclined to make purchases. They have to conserve and stretch what money they’ve saved until things normalize again and they can go back to employment. For SMEs that are not in the limelight, those that are trading goods and services that wouldn’t be classified as “necessities” during this time, this decline in market activity could cost them their business.

This is why there is a need to innovate and adapt. If this is exactly the kind of situation you’re in right now, all the more reason to think outside the box. Your business needs to adjust to this “new normal.”

We know that you have a lot of questions, especially in terms of managing your finances during this uncertain time. If there is something about your business you would like to consult us about, feel free to join us on our next LIVE in Uncover Wealth Radio, a Podcast dedicated to delivering the newest updates on Coronavirus and UK businesses. We air every weekday at 11:00 AM. We can answer your questions in real-time if you come to meet with us.

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