Amid the coronavirus pandemic, 90 retail organizations — among them the FDRA, AAFA, CFDA and NRF — are calling on the U.S. government to take swift action to address the economic harm retailers will face.
“The economic harm from social distancing and mandatory store closures is real. Layoffs and economic hardship will surely follow, particularly for smaller, specialty retailers and brands,” reads the March 21 letter addressed to President Donald Trump. “The biggest single issue facing the industry right now is liquidity, and federal stimulus efforts must be swift and flexible enough to address the urgent need for access to credit to keep these businesses afloat.”
The organizations applauded the Trump administration and Congress for their response to the health and safety issues caused by the coronavirus, as well as their response so far to the overall impact on the American economy. However, they asked for further action to assist both retailers of all sizes and kinds as well as their suppliers — noting that many retail businesses are being forced to temporarily shutter their doors as “nonessential” businesses are ordered to close down.
“It is important that the stimulus package provide a bridge, not a bailout, that is flexible enough for retailers and related suppliers of any size to take advantage [of it],” the letter reads. “Retailers are not only the bedrock of the U.S economy but also support many supply chains throughout the U.S. and the local communities they serve. Our collective members are working to ensure the health and safety of their employees, supply chain partners and customers first and foremost. We want to make sure these companies are able to continue operations when we eventually get through this crisis.”
According to research from the NRF, the American retail sector could see declines by 20% or more in retail sales over a three-month period due to the coronavirus pandemic, for an estimated loss of $429.9 billion in direct and indirect sales. If this drop in retail sales occurs, the NRF says, more than 1.7 million American jobs will be at risk — and these effects would be worsened should the pandemic linger, the letter said.
“Of course, with the virus continuing to spread and economic damage being compounded, lost retail sales could climb much higher — between 50% and 80% in some sectors — with even more American jobs jeopardized. Unless immediate steps are taken, these dire economic outcomes could persist for many years,” the letter said.
Leaders from both sides of the aisle are currently working on a stimulus bill with hopes of blunting the economic impact of the coronavirus. The Senate is reportedly expected to vote on the more than $1 trillion package by Monday. Several provisions of the bill are still up for debate, including how much cash to give to taxpayers and how to expand unemployment relief.
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