What do you say to an entrepreneur who might have to lay off their entire staff?
What do you do when those employees need those jobs to survive?
These are painful questions for us. At Sinapis, our mission is to make disciples and alleviate poverty through the power of entrepreneurship. We believe one of the best ways to help the poor is to support growing businesses that create and sustain jobs. The entrepreneurs we serve lead small and medium-sized businesses (SMEs) in seven emerging market nations (Kenya, Uganda, Rwanda, Ghana, Liberia, Brazil, and Egypt). They are entrepreneurs by choice, not by necessity and work to grow profitable, faith-driven companies that provide for others and build the local economy.
These companies and the jobs they provide are under
incredible pressure in this time of uncertainty.
Brian Gacheru is a Sinapis alum and the CEO of Pristine Linen and Laundry. The company provides commercial laundry and linen rental to the hospitality industry in Nairobi, Kenya. In late February – just over 5 weeks ago – his business was booming. Then COVID-19 happened. Fear gripped the world. Cases started to emerge in East Africa. Governments quickly put in place containment measures including closing borders and restricting air travel. Schools were closed, public gatherings including church services were discontinued, and curfews were instituted. Thus far, less than 350 cases have been confirmed across Kenya, Uganda and Rwanda, but it is too early to know how the disease will spread. What is clearer is the destructive economic impact of the crisis. For Pristine Linen, it’s primary customers are high-end hotels. As business and leisure travel turned off like a faucet, 90% of Pristine’s revenue dried up. Brian shared,
“Things have changed so quickly.
A month ago, I was planning to hire a
consultant to help me plan for the next
stage of growth in my company.
Today, our business is almost
completely on hold.”
COVID-19 is testing the entire global community in ways we haven’t seen since World War II. Uncertainty and fear have become a daily reality everywhere, but this crisis could be particularly devastating in less developed economies with weaker health systems and reduced social safety nets.
According to the World Bank, growth in Sub-Saharan Africa has already been significantly impacted by the coronavirus outbreak and is forecast to fall sharply from 2.4% in 2019 to -2.1 to -5.1% in 2020. This would be the first recession in the region over the past 25 years. From an employment perspective, SMEs are vital. They provide two-thirds of all jobs worldwide and account for the majority of new job creation. Most SMEs are not able to transition to remote working, and few maintain more than two months of cash reserves. Even temporary disruptions in cash flow can wreak havoc on the business and on its employees whose families depend on a regular paycheck for survival.
As governments in these markets fight the spread of the virus, challenges abound. Testing capacity and ICU beds are in short supply. Large and densely populated cities make social distance a luxury that many cannot afford. For the urban poor, life is lived day-to-day, and sheltering in place for weeks at a time is not possible. The crisis is forcing many to travel to their home villages, which could further the spread of the virus. Limited government budgets constrain the amount of fiscal and monetary policy that can be offered to support a recovery.
In the face of the uncertainty and their own fear, the entrepreneurs we serve continue to use their businesses to advance God’s kingdom. One Sinapis alum has invited three employees and their families who lacked savings to live with his family until the crisis passes. Another has chosen to equally divide any ongoing profits that the business generates among the staff to ensure that everyone can pay rent and feed their children. One alum who has successfully managed his business for over 18 years was forced to lay off all eight of his employees. However, he is training them to grow emergency gardens in 20 litre containers and plans to distribute food packages in the weeks ahead. Yet another is distributing food to families in Kibera slum. Businesses dedicated to God play an essential role in promoting human flourishing in good times and in bad.
As we prepare to celebrate Resurrection Sunday, it is an opportunity to remember that we serve a God of hope. Our King died for our sins and conquered the grave. He rose victorious and sits on His throne today. No matter what we face, we can rest in the fact that our loving, compassionate God lives and reigns over everything.
A well known hymn called “Because He Lives” captures this well. The song was written in 1971 during a time of social upheaval. Its chorus offers a trust-filled picture of confidence in Christ while not ignoring the struggles of life in a broken world.
Because He lives, I can face tomorrow
Because He lives, all fear is gone
Because I know He holds the future
And life is worth the living, just because He lives
The days ahead won’t be easy. Lives will continue to be lost. Many businesses will fail, and jobs will go with them. We do not know how this will affect the most vulnerable, and we are praying and working to preserve life. Entrepreneurs and business leaders placed by God in the marketplace are using what they have to minimize the impact on their employees and their dependents. They will fight to innovate and emerge stronger on the other side. But knowing He lives and holds the future, we can face this together with courage and hope.
Written by Matthew Rohrs