Central Bank sees 200 percent increase in retrenchments – 1,728 let go in 5 months

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Central Bank sees 200 percent increase in retrenchments – 1,728 let go in 5 months

The Central Bank of T&T has counted 1,728 retrenchments in the five-month period of July-November 2020.

According to its Economic Bulletin, for the same period the year before, there were 577 retrenchments. The report said the number represents a 200 per cent increase.

Through its monitoring of retrenchment notices, the bank said that the finance, insurance, real-estate and other business services served the most notices, with 802 people getting pink slips.

285 people lost their jobs in the distribution, restaurants and hotels sector, while the energy sector let go 176 people and manufacturing retrenched 171 people.

The bulletin said “The ongoing covid19 pandemic has caused considerable labour market ‘slack’ throughout 2020.”
It cited the border closure, travel and dining restrictions at bars and restaurants, as well as the closure of places of leisure as reasons for the retrenchments.

Job advertisements dropped by 37.8 per cent, indicating that the demand for labour may have waned.

The bulletin also reported a contraction in domestic economic activity and reduced revenue, which contributed to a larger deficit in the last half of 2020.

There were also rampant contractions across the energy sector, attributed to the planned maintenance of two large facilities, Atlantic LNG trains two and three and a fall in demand for TT energy exports owing to covid19.

As demand fell, production of natural gas and related energy-sector products fell also, and eventually several downstream petrochemical plants were shuttered.

Over the second half of 2020, the report said, natural-gas production was reduced by almost a quarter (23.6 per cent).

The fourth quarter also saw a drop in LNG production because of the controversy surrounding the future of Atlantic’s train one facility.

Between October and November LNG production fell by almost half (46.9 per cent). Methanol dipped by 29.4 per cent.

Government registered a deficit of $16.8 billion, four times higher than the year before ($4 billion), mainly due to lower revenues and increases in expenditure.

Retail prices for building materials, considered a positive indicator of construction activity, increased by 3.2 per cent during the fourth quarter compared to 2.4 per cent during the previous quarter.

Inflation held relatively steady during the second half of 2020, in part because of the restriction of economic activity and measures to mitigate the spread of covid19. Between July and December last year, headline inflation remained low, averaging a 0.7 per cent year-on-year.

Food inflation measured 2.3 per cent in July, but by the end of the year it had accelerated to 4.5 per cent. Core inflation, which subtracts food inflation, remained at zero.

“The acceleration in food prices was driven by strong price growth in most sub-indices, most notably in the butter, margarine and edible oils; sugar, jam, honey, chocolate and other confectionery; vegetables; and fruits sub-indices.”