The COVID-19 health and economic crisis had an immediate and serious impact on TCLF companies and employees alike. The disruption of supply chains and the shutdown of retail outlets completely destabilised these industries by dramatically reducing sales, leading to extreme contractions of revenues and financial distress for TCLF companies across all value chains. As a result, factories were suddenly closed, putting thousands of people in temporary – and less temporary – unemployment, slowing down the productive capacities of companies and weakening the growth of these sectors mostly made up of SMEs.
The risk that the effects of the crisis will linger even when lockdown restrictions have been fully lifted is high: the European TCLF industries are mostly consumer goods industries and are therefore highly sensitive to the economic well-being in major global marketplaces, and in particular of EU Member States and purchasing power of EU citizens. The recessionary market and the decrease in demand that will follow the immediate crisis put the TCLF companies and employees in major peril.
The EU TCLF Social Partners are certain that making the right choices today on human and capital investments will not only have a positive impact on the medium-term recovery from the crisis, but will also be a source of long-term stability and a catalyst for the EU to meet the challenges of tomorrow.
