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The recent outbreak of the coronavirus has caused massive destruction across the world. It has not only taken thousands of lives but has also devastated the entire global economy. Experts suggest that the deadly effects of the virus will become visible after its eradication. Thousands of businesses have already shut down, others are on the verge of going bankrupt, and more than a million people have lost their jobs. This article throws light on the lethal impact of COVID-19 on businesses.
The first and possibly the most traumatizing COVID-19 impact on business is massive layoffs. As if a 45-year high unemployment rate was not enough, the virus has deepened the worries of the working class. The worst-hit have been those working in the unregulated sector – factory workers, domestic and daily wage workers – who have been driven out by their masters. Talking about the regulated sector, conditions are not so pleasant either. Work from home has been a savior but if conditions don’t improve, employees will face the brunt. Hikes don’t seem likely and companies are also restraining perks, especially to C-level employees. The industries that have been hit the most by COVID-19 are airline, tourism, and hotel and have been declared hotspots for future layoffs.
Disruptions in the global supply chain
The nastiest COVID-19 impact on business has been on keeping supply chains robust. Since China is the manufacturing hub of the world and also the source of the virus, the production rate has plummeted. Industries such as electronics, chemicals, building products, etc. have been declared high-risk categories because they depend mostly on China for their stocks. Low-risk categories that include sectors such as computer peripherals, telecom, and automobile appear to be out of imminent danger but the question is for how long?
Investors are unwilling to invest
COVID-19 impact on business is also deepening because investors are shying away from investing money, especially in new companies and those without a sound credit score. Banks have also adopted very strict terms and conditions to lend money to borrowers. Investors believe that the world has yet not seen the full force of the virus which has severely restricted their ability to invest in banking institutions. Hence one shouldn’t wonder why bank stocks are falling worldwide.
COVID-19 has spread across the globe and shows no signs of stopping. Scientists and doctors are trying to find a vaccine but a formidable solution appears to be on the other side of the horizon. There is no doubt that the COVID-19 impact on business has been catastrophic but modern enterprise technology can help reduce its effects drastically. At Sage, we are home to world-class ERP and CRM software that helps you run your enterprise like a pro. To know more about it, SMS SAGE to 56767. You can also write to us at firstname.lastname@example.org.
Disclaimer: All the information, views and opinions expressed in this blog are those of the authors and their respective web sources and in no way reflect the principles, views or objectives of Sage Software Solutions (P) Ltd.
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