The Cooperatives navigating Covid-19


The BBC News article reports on the rise of cooperatives around the world, as smaller firms and individuals have come together and pooled resources over the past year to navigate the challenges posed by Covid-19: preventing business collapse, redundancies and financial hardship. 

Cooperatives are businesses that are owned and democratically ran by their own members - it could be be a group of smaller firms that join resources or a collective of self-employed workers.

Dr Gabriel Burdin of the Economics Division provided expert insight on the strengths of cooperatives during times of crisis: 

In conventional business, layoffs are the most frequent cost-cutting strategy… Cooperatives adjust along other margins, such as pay cuts or work-sharing arrangements. Cooperatives share the consequences of a crisis among their members.

Dr Burdin also however highlighted the financial risk involved with cooperatives, particularly those owned by their own members - who risk losing more if the venture fails: 

"By providing labour and capital to the same company, they are putting all their eggs in one basket.”

Read the full article on BBC News.