Region hit with thousands of layoffs: study

In a number-filled survey that looked at the devastating impact COVID-19 has had on Niagara’s economy, it’s the words that got to Blake Landry.

Nearly two-thirds of businesses surveyed have laid off 76 to 100 per cent of their staff; more than 1,100 closed temporarily.

Another 43 businesses shut their doors for good.

“I’ve read a lot of very sad accounts of people having started a business, investing their life savings into a business, and then losing that and having no income for their families,” said Landry, manager of economic research and analysis for Niagara Region.

“It pulls on the heart strings because you know that these people — this is their livelihood, and this crisis has really affected their livelihoods.”

Between March 20 and 30, Niagara’s Economic Rapid Response Team — formed only last month — contacted more than 10,000 businesses across Niagara.

The team, made up of staffs from the region’s six municipal economic development offices, will share that data with local, provincial and federal governments to help with an economic recovery plan.

More than 2,600 businesses representing more than 66,000 employees responded. Only 75 — mostly in the software or technology industries — reported no impact from the coronavirus.

More than 950, though, said they have lost 76 to 100 per cent of their revenue as non-essential businesses remain closed to contain spread of the virus.

Two-thirds have reduced staff, with most saying they’ve laid off three-quarters to 100 per cent of their full-time employees.

Last week, a separate study by Niagara Workforce Planning Board found 11,000 people in Niagara lost their employment in March over COVID-19.

Updated results to be released next month look to be just as grim.

“It’s bad news, but it’s also data and information that we need,” said Landry of the rapid response team study.

“The consortium, we’re working to implement an economic recovery plan. We need to have information to really understand what the impacts are.” Some highlights:

If shutdowns and service reductions mandated by the government continue for three months, the survey estimates Niagara businesses will lose $576 in revenue. That climbs to a $1.35-billion loss if this goes on for a year;

Accommodations and food service industries were hardest hit by layoffs, followed by retail;

Nine-hundred and forty-seven businesses have laid off three-quarters to 100 per cent of their part-time staff.

The part-time job layoffs are particularly worrisome to Landry.

“These are people that struggle economically, who get by paycheque to paycheque. They’re critical to our economy,” he said.

“Without them we wouldn’t have people that essentially operate the businesses, then they get affected the hardest right off the bat.”

Service providers for Employment Ontario, such as the John Howard Society and Job Gym, are essential services and remain open. But their staffs will likely be strained having to deal with all the people seeing assistance.

Landry said Niagara Falls and Niagara-on-the-Lake, as tourism centres, likely bore the initial brunt.

Niagara Falls Mayor Jim Diodati called it “a huge economic kick to the teeth.” But, he cautioned, layoffs at hotels and attractions there ripple right across Niagara.

“It’s not just Niagara Falls … when you look at the casinos, 20 per cent of the employees overall are in Niagara Falls, but 30 per cent are in St. Catharines.”

All the operators are nervous, he said, not knowing when things might return to normal.

“Some of these guys have gone into their lines of credit,” he said.

The full study is available at NiagaraRegion.ca.