Published by Chester Robards, The Nassau Guardian, October 13th, 2022
Businesses will have to re-evaluate their costs in the wake of government’s decision to increase the minimum wage for the private sector in the new year, which could lead to further price increases for consumers, chair of the Bahamas Chamber of Commerce and Employers’ Confederation (BCCEC) Khrystle Rutherford-Ferguson told Guardian Business yesterday, adding that the private sector was not opposed to the increase.
She said the roughly 24 percent increase – from $210 per week to $260 per week – will mean that some businesses will be able to tolerate the increase; some will have to increase the costs of their goods and services; and some companies may fold under the pressure of the new expense, increasing unemployment in the fallout.
“I think that’s just the reality of this announcement,” said Rutherford-Ferguson.
“And not only that there are economic conditions, the economic conditions now are such that the impact of this increase to certain businesses we’ll be seeing over not only the short term, but also the medium term.
“And we would have addressed these impacts in the public domain before. So, they are impacts that may lead to further inflationary prices of goods and services to the consumer.
“And then the other impact is if the inflation that I’m mentioning is not tolerated well by consumers, meaning that the consumer decides not to buy or dramatically reduces their spend on certain goods and services, the result inevitably will be a downsizing of labor, and this will further affect the unemployment rate or result in the permanent closure of some of the impacted businesses.”
Rutherford-Ferguson said these are already difficult times for businesses given the recent announcement of an increase in the Bahamas Power and Light costs, a looming increase in National Insurance contributions, and the everyday costs associated with running a business in a high inflation environment.
She said the businesses that will be impacted the most will be the small businesses and the mom and pop shops that service the community.
“And all of this is happening while trying our very best to maintain competitive pricing to meet the demand of our customers,” said Rutherford-Ferguson.
“As we continue to explore what all this means, it also goes to the heart of the fact that the cost of doing business in The Bahamas continues to rise, and already struggling businesses that are still reeling from the impacts of COVID-19 will have it that much harder,” Rutherford-Ferguson said.
“These are the points that the business community will have to grapple with.”
She said the BCCEC hopes the government will make changes that will ease some of the pressures on the business community.
“We’re looking forward to being advised of some balance the business community can look forward to seeing,” she said.
“[We look forward to] there being a clear understanding of the fact that there continues to be these rises in costs and where there can be some reprieve … even with taxes.
“So, persons who would have addressed the whole business license fees, they’re right to address that.”
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