Going Out of Business- The Impacts of High Cost of Living, Where Does it End?
- Morine
- Nov 15, 2023
- 5 min read
It is so sad to see the state of the economy nowadays and how it has impacted literally" everyone of course some more than others. It is sad to see the closure of businesses that have been around for many years there have been a few that have not been able to recover since the pandemic and now with the rise of interest rates, it was the final nail for some ailing businesses. The news that a long-running business such as Bad Boy Furniture has filed for bankruptcy protection brings home the reality of how bad things are for some retailers,
https://globalnews.ca/news/10088225/bad-boy-furniture-files-notice-under-bankrupcy-act/
It makes you think if such a giant can't survive the state of things as it is now then how can the smaller mom-and-pop stores survive?
With businesses suffering financially they no doubt tighten the purse strings and cut costs where they can, such as reducing their workforce and restructuring operations to find the best way forward through these difficult times, it's all about living to fight another day. When that can't be achieved then they shutter for good taking the hopes and dreams of that venture which was once a labor of love.
This is all quite noticeable in the current job market referencing the job site Indeed who reported that holiday job postings are down 30% in the Canadian market over the same time in 2022. The same article noted that amid the decline in holiday postings, there is an increase in Job seeker searches for holiday work.
https://www.msn.com/en-ca/money/topstories/live-news-seasonal-job-postings-plunge-as-canadian-economy-cools/ar-AA1jEntF?ocid=socialshare
So clearly all of this spills over into individual households with huge impacts as people try to survive at a time when it seems every facet of the economy is spinning out of control. While facing higher costs of living in pretty much every category across the board, some households are attempting to supplement income by looking for part-time/seasonal jobs to bring in more income but with companies tightening their belt, options in this area are becoming limited. With companies reducing their workforce other households are faced with loss of employment resulting in considerably reduced income or no income at all depending on the Employment Insurance situation they are faced with in their area.
I myself am living the impacts of the economy, with the loss of my job and having sold my home due to the high-interest rates it seems as if there is no answer in this current economy because now the issue I face is lack of rental properties and rental costs at enormous amounts and rising. Layer in the increased cost of food, household supplies, gas, and insurance with utility costs also on the rise, and the question is where and when does it all end? I have seen articles that have reported that higher interest rates are here to stay which is a scary thought, so where does that leave us? For those who have been decimated by the rapid change in the cost of living, how do we recover? Clearly, we can't work our way out of this as the average wage has not increased sufficiently to offset the rise in household expenses, so where does the answer lie for the average person? After contemplating these questions I have decided that for myself the only way forward is to think outside of the box and look for opportunities in the non-traditional way.
Life right now can feel dark and unrelenting, I have read so many stories of people who have lost literally everything they have worked hard to build that is certainly a bitter pill to swallow. People are now turning to TikTok to share personal experiences on inflation and how it has impacted them, it is really an exploding topic just people venting about inflation. These videos really show how everyone is affected in one way or another, it also shows that the issue spans the globe.
I don't begin to say that I understand the formula for raising or lowering interest rates, I'm sure the bright minds at the Bank of Canada have all the necessary formulas in place for that, but what I don't understand is how it benefits the economy to have so many people collapse under financial strain and companies go out of business? I am also shaken by the report that stated the Bank of Canada employees got big bonuses, higher than in previous years, $26.7 million in bonuses and raises in 2022 to be exact. I am personally choking on that bit of information to know that so many have faced financial ruin amid the cost of rising interest rates but they profited nicely from our demise. Yeah, that's a tough one.
Oh and let's not forget based on news reports it seems the grocery stores have also made record profits, it's reported that in 2022 the top 3 grocery chains in Canada Loblaw, Sobeys, and Metro made a combined record profit of $3.6 billion at a time when food banks are buckling under the pressure of increased demand that they cannot even satisfy. How can this be? Please make it make sense!
https://globalnews.ca/news/9098447/canada-inflation-grocers-profits/
I am going to keep searching for the answers to some of the questions I have posed above. We are certainly living in difficult times and it is going to require a lot of belt-tightening to get through to the other side of this. It will also require patience as rebuilding what was lost will not be accomplished overnight and will take time. This will be the very definition of "put your nose to the grindstone". The reality is the same everywhere and no one is immune, in a recent interview Kevin O'Leary mentioned that "We're looking at a downsized America" Essentially this means whatever level of lifestyle you enjoyed in the past you will need to adjust to a smaller and more reduced way of living.
I think that the Tiny Home movement may have the right idea as it seems downsizing is the only way forward, or maybe Vanlife if you can make the adjustment to living as a Nomad. On the other hand, if you are looking for work think about seeking out opportunities in ways that you may not have considered before, such as posting your skills for hire on sites such as Upwork, Kijiji to name a couple this will open you up to opportunities with small businesses and self-employed individuals that could benefit from your skills.
My prayers go out to all who are facing challenges and uncertainty right now, don't give up keep on pushing. Whatever path you take to adjust to our new reality just ensure you taper your expectations and exercise patience as the recovery won't be immediate, just take it one day at a time.
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