COSBOA calls upon policy makers and all levels of government to respond to the COVID-19 emergency for short term and long term needs of businesses and their employees.
Last week our members met in a crisis meeting and have suggested a range of measures that governments should consider. These are listed HERE. We have also developed a draft plan and budget for responses which is around $14 billion. This is needed to ensure that the immediate needs of businesses and their employees are met and that, importantly for the economy, the businesses that have to close will reopen. The governments – federal, state and local – may not need to react with big spending but they must be prepared to do so and it appears that they are.
Key COSBOA measures for particular events:
1. Scenario and response: Some businesses will need to close, hopefully for a short period only. Training vouchers should be made available to employers to offer to their employees who are laid off. The employee who wishes to use the vouchers can be offered a training wage of 75% of the minimum wage while they access the training.
This measure will assist people stuck at home with a worthwhile activity and give an option for earning a productive income to those who have no paid leave available.
2. Scenario and response: Apprentices will be laid off and if they are not re-employed then a lot of training will be wasted and industry skills levels will be negatively impacted. Employers should be paid an incentive of $8k per apprentice that they currently employ. Rules would be in place to ensure the apprentice is retained or re-employed if they are laid off for any period.
3. Scenario and response: Business closes for 4 weeks and struggles with cash flow as they have no income but still need to pay workers on sick leave and annual leave, as well as rent and utilities. Grants of up to $50k should be made available to business that have significant cash flow issues (say, a 30% decrease on the same time last year).
The real impact of the virus is as yet unknown and is difficult to predict, but we can do scenario planning and prepare for various effects on small business. Planning ahead is what businesses and governments – federal, state and local – must do.
We also know the psychological impact on employers and employees will be an issue. The funds provided by the government to those who offer support with mental health will also need to be reviewed and increased as necessary.