In a move that was only a surprise to those not paying attention or to those who believe that business owners have an indefinite amount of money, Regal Cinemas has announced that it will be shuttering it's theater(re) operations in both the US and the UK. This means that IF these jobs come back, they won't come back all at once, and the likely will be at a reduced pay rate because the company is going to have to find financial stability once again.
Yes, we've seen many small business closings recently, but the COVID restrictions are now reaching far beyond them and are beginning to claim some big time skins to hang on their wall.
Regal Cinemas will be joining a growing list of companies that include: J. Crew, 24 Hour Fitness, Advantage Rent-A-Car, Briggs & Stratton, Brooks Brothers, Chuck-E-Cheese, Gold's Gym, JC Penny, McDermott International, Neiman Marcus, Pier 1, Remington, Technicolor, and others in filing either Chapter 11 (debt restructuring) or Chapter 7 (liquidation & closing) bankruptcy paperwork; and the list just keeps adding bigger and bigger names.
Sure, some companies are doing great during the pandemic. Grocery stores are doing well, Amazon is exploding, Wal-Mart continues to do well with it's low prices and incredibly deep back stock, but those do not a full economy make, and as more and more sectors of the economy shut down for good, we get further and further away from fiscal solvency.
Here's the rub, businesses don't re-open on a dime. It takes money to get things ready logistically, it takes money to rehire and retrain a workforce, it takes money to advertise you re-opening, and it takes money to keep the company's shareholders from bailing out. Where will they get that money? Especially if they've already filed for Bankruptcy protection or liquidation. Take out a loan? Who will give it to them in the uncertainty? Take on more investors? Diluting your shareholder's stakes becomes a losing game. So where will you get the money? For many, the answer is they won't. I've said all along that the hardest part of this "Pandemic Shut Down" isn't going to be surviving through the pandemic, that'll be easy because the government can give stimulus money, food stamps, provide milk to charities instead of dumping it, and all of the things that they've done since March of 2020.
No, the biggest, and hardest part, is going to be transitioning back to a fully functional economic system. Re-opening entire sectors of the economy with banks and lenders worried about "second-waves" and all kinds of other things that will put their money at risk. Capital will be low, it will come with ASTRONOMICAL interest rates, and there won't be enough of it for everyone who is attempting to make a new go of things. So get used to it, many things that you see shuttering up right now, THEY AREN'T COMING BACK.
By far, the most unrealistic idea that people appear to have in their minds is that, "once this is all over, everything will bounce right back and we'll be back to normal."
No... it won't, and we won't either.
I wish I could tell you that 2021 looks better than 2020, but I'm afraid I have to be the bearer of bad news, 2021, at least the first quarter maybe even the first half, will be tough, and that's IF we can begin the reopening by then. It'll be even worse if we don't.
There will never be enough Amazon jobs for everyone, and as unemployment drags on with incorrectly skilled workers (for the sectors which remained open) looking for jobs outside their skilled sector, we could be bearing a great deal of unemployment benefits into 2021. Is it better than feared, yes, but 8%+ unemployment is still too much, even if they were projecting 12-20%.
The longer your local businesses go with no or reduced income, the more likely it becomes that they'll have to close. If it's a small business, the owner will likely go and work for someone else in a leadership role. That means that they're unlikely to reopen their business which will eliminate jobs and economic activity. I hope they weren't one of your favorites places.
The medium businesses? Some will come back, some won't, and some will get gobbled up by larger businesses and then your time there won't amount to a hill of beans. So a new job might be in order instead of waiting for your old one.
I hear people all the time saying that they're just waiting for their company to re-open. Yet the longer we remain at reduced operation, the less likely those jobs are there waiting for you. That's the biggest problem with Biden's desire to see us go backwards and enforce more stringent COVID-19 shut downs and "protective orders." He's being paid by lobbyists, he doesn't care if your job is there, nor does he care if ANY job is available when you get out. His head is buried so far in the sand that I think he ACTUALLY believes that these jobs will just all bounce back, "because he says so."
Typical politician, but what do you expect from a guy who hasn't had to hit a payroll or make his rent & triple net payment month in and month out for over 47 years. He's deluded, he's delusional, and he honestly believes that you'll believe him.
My concern is that there are a bunch of people who will, because they don't understand business. They think the government can just print money, and they believe, "well, if this one closes, another will open, so what's the problem." The problem is that money, the economy, and jobs don't work that way, and America, as well as much of the rest of the world, is going to find that out in 2021. It's going to be a very bumpy ride, buckle up, and get ready. The economy has to be priority #1 when voting in less than a month.