17
Jul.

2020

An employee being tensed with a Layoff Termination letter
The era of Slumping and Crippling of Economy: Bankruptcy and Lay Offs

The tornado of blue devils hit the entire global world with the entry of inconspicuous creatures first seen in the province of the giant nation, China with the holocaust of thousands of people and unhinging the entire world and its economy. The COVID-19 pandemic also is referred to as a pestilent hop in the last 100 years after the Spanish flu pandemic locking down the people inside the houses to finesse the virus contact shutting down giant business companies to untold emporium freezing the economy at zero levels. Even the gigantesque nations aka rich in technology and resources stick their hands together and pray the Almighty God to stop this dreadful pandemic even though pick-and-shovel elbow grease was made to mark the full-stop. No transactions, continuous lockdown, social distancing, and warped economy.
 
         In the context of Nepal, people have had expectations that the year 2020 would be a year where millions of tourists would disport their arrival due to effective planning of VISIT NEPAL 2020 but the beginning of year became tartish when the outbreak of coronavirus pandemic was hitting the world sluggishly but later changing its way into the snappy mood. The travel and tourism sector got affected and the high investments seemed to have zero matter effect taking away everything. Similarly, latest projections mentioned that the agricultural, industrial and service sector to be grown up by 2.6%, 3.2%, and 2% respectively but the virus outbreak stroke the second half of the fiscal year and also, work-from-home norms and standards cannot be applied in such sectors resulting catastrophe in the national economy. At the time of the flourishment of innovative local start-ups, the pandemic compelled these companies to mark comma or full stop in their operations resulting in some of the companies silently disappear. Jaw-dropping corollary due to COVID-19 in every sector like finance, banking, aviation, business, retail, sports league, restaurants, tourism, every sector has been the hardest hit. Some companies have been facing financial trouble pre-COVID-19 but the COVID-19 caused serious impacts resulting in selling off assets and closing for good. According to the US report, 530 restaurants, 498 Construction and Supplies, 480 Real Estate, 228 Banking and Finance and other industries had filed bankruptcy. Concerning the whole world, the number exceeds more than a thousand. As per the research conducted and reports published by top-notch researchers and journalists, the following companies have filed for bankruptcies and announced to close their stores: 

  • Hertz, a car rental company on May 22, 2020
  • Hornbeck Offshore Services, Inc. on May 19, 2020
  • CMX Cinemas, a chain of movie theaters with dine-in-options on April 25
  • Rubie’s Costume Company, one of the world’s largest designer and manufacturer of Halloween costumes on April 30 
  • Gold’s Gym, a Dallas-based company owning and operating over 700 Gyms in the US and internationally, on May 4 and 32 stores were already closed in April
  • Zara’s parent company, Inditex announcing plans to close between 1000 and 1200 stores over the next 2 years
  • Brooks Brothers to close 250 North American stores
  • Lucky Brank, a denim company to close 13 of its 200 stores

        These are just a few names of the giants which had filed for bankruptcy and closed their stores. Laying off employees due to losing out on cash flow by the businesses is one of the major negative upshots of the COVID-19. 
  • Air Canada to lay off 60% of employees at least 20,000 employees
  • Companies like Swiggy, Oyo, BookMyShow cutting jobs
  • AirBnb, a home rental start-up, laying off 25% or nearly 1900
  • Boston University, laying off over 1,600 student workers
  • Marriott International, the world’s largest hotel company, to lay off thousands of hotel workers
  • Satellite TV provider, Dish laying off 16,000 employees 

Moreover, tens of thousands of companies all over the world are facing difficulties in cash flows and bankruptcy and layoffs resulting in massive unemployment. Calling off sports leagues, concerts, and festivities and other programs also resulted in losses for hundreds of people. Accepting the available jobs locally or generating an idea and working on it matching the coronavirus crises have been the acceptable alternative in this scenario.

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