OPINION: Businesses have relished the chance to lose dead wood thanks to Covid

Has your company made staff cuts and passed them off as vital because of lockdown?

Has your company made staff cuts and passed them off as vital because of lockdown? - Credit: Getty Images/iStockphoto

Companies are getting rid of staff behind the facade of coronavirus, says Rachel Moore

M&S posted its first ever loss in its 94-year-old history this week.

It chopped 7,000 jobs in August. Yesterday, the John Lewis Partnership (JLP), announced it was axing up to 1,500 jobs at its head office as it made drastic cuts across the business. It announced earlier this year it was shutting eight of its stores.

As the job loss announcements keep on coming, a Bank of England policymaker said UK unemployment could climb higher than current forecasts as the pandemic continues to hit job, warning the jobless rate could rise above the Bank’s predicted peak of 7.5%.

More than 30% of the private sector workforce was furloughed. A third will not return to their jobs, Monetary Policy Committee member Gertjan Vlieghe said.

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“Our economy is wrecked,” comes the wail as another swathe of job losses come out. More than 670,000 jobs in the UK have been lost since the start of the year.

Yet, as weeks pass, another side to the ‘we’re doomed’ hysteria is emerging. Some – many – businesses are booming, smashing targets and can’t keep up with demand.

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“Never been busier,” “Can’t keep up,” and “we’re 150% up on this time last year.” I’ve been told all of these statements in the last couple of weeks.

The housing market is booming, new cars are swarming from garages, people are spending on their homes, on kitchens, bathrooms and planning blow out holidays when this is all over. This isn’t the being careful in case or nervousness about what might happen next.

The Covid economic landscape appears to be a tale of two halves. But appearances can be deceiving.

On one side are the stricken, the other, the booming.

All the statements above came from businesses that did initially feel the pain of the Covid crisis. Workers were furloughed, business plans revisited and rationalising and workforces remodelled.

Within weeks of the first lockdown, a very successful businessman told me: “I thought I was running a super-efficient business until Covid. Then I realised that it would run just as well and we could deliver all our services effectively and efficiently to our customers and clients with 20% fewer staff.”

So redundancies and early retirements were made and a new leaner company emerged.

What the Covid-19 crisis has shone a light on is how businesses were inefficient and where cuts could be made without sacrificing service or quality while maximising profit.

In short, too many businesses were flabby, over-staffed and inefficient, even though they believed they were sharp and on it. Realisation only came when operations came under the microscope of lockdown and furlough.

Fast forward to now and so many companies have used the crisis as an opportunity for a clear out and, in some cases, a refocus.

It’s been a chance to clear out the dead wood, the reluctant to change and the staid. Lockdown and furlough gave these businesses breathing space to take stock and examine what they were doing and how they did it.

Not great news to the surplus to requirement people, those who found themselves out of work and looking for jobs in the worst pandemic in history and financial crisis in centuries.

But, like phoenixes, these businesses have risen from the crisis and are doing better than ever.

But, what this means, is that they are not recruiting yet.

And young people, being hit hardest, are not getting the training opportunities and can’t access jobs anyway, if there were any, because they have no experience.

And, of course, these businesses booming, are not the hotels, restaurants and bars selling off cheap, or free, their last drink and food before being forced to shut their doors again yesterday. Now it’s a lottery which will reopen.

Neighbourhoods this week highlighted as “double distress” areas that will be stricken by the legacy of a double lockdown for years included Great Yarmouth .

With its existing job shortages and job losses, it is more than twice as likely as the average neighbourhood to be at high risk of job losses associated with the pandemic.

Already cut off from the wider employment market, Great Yarmouth is now in fear that many of their existing jobs are at risk of disappearing – at a time when even its infection levels, higher for a Tier 1 but far lower than other areas.

The average age of the people killed by Covid is 82 – higher than the average life expectancy in the UK. It’s harsh to say, but history is likely to judge the lockdown decisions harshly – closing a country to save lives of people who had already outlived their expected life expectancy, leaving those young people who cannot find work now, paying for the crisis throughout their working life.

And let’s not forget the people calling for the lockdown; the scientists and NHS leaders who have never known the pain of redundancy, or fighting to keep a business going and paying their staff and suppliers, those who have always been paid a salary with no worry about where the next pay cheque is coming from.

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