Saturday, October 14, 2017

Another Canary In The Coal Mine



Everyone these days focuses on the middle class as the engine which drives the economy. However, Susan Delacourt writes, the shuttering of Sears stores across the country tells the story of what has happened to the Canadian middle class:

Retail analysts have been warning for some time now that e-commerce is threatening the very nature of shopping.

Those same analysts are saying, however, that you can’t draw a straight line between the rise of digital shopping and the downfall of the big stores like Sears or Zellers.

“The bigger thing is the shrinking of the middle class,” Barry Nabatian, market research director of Shore-Tanner Associates, told Ottawa’s local CBC Radio morning show this week. 

Neo-liberal economists, like Joseph Schumpeter, call it "creative destruction." But there's nothing creative about it:

The current troubles in the Canadian retail business have at least three dimensions, fallout-wise. When things go badly, we have to worry about the people who work in the stores, the people who shopped in the stores, and, as a Star story pointed out this week, all the businesses that supply the shops, too.

“The list of suppliers left in the lurch by the Sears Canada insolvency reads like a who’s who of retail and it circles the globe,” the Star’s Francine Kopun wrote, describing the tens, sometimes hundreds of thousands of dollars Sears owes to a vast array of businesses whose products fed into the once-great store empire.

That's a lot of destruction. The death of Sears is another canary in the coal mine. There have been several since the financial meltdown ten years ago. But the powers that be don't appear to be paying attention.

Image: imgarcade.com

8 comments:

Anonymous said...

The corollary to the death of Sears is the huge growth in dollar stores. Simpson's, Eaton's, Woolworths, KMart, Zellers and Target are among the many department stores that have failed by catering to the middle class. The only ones left are the Bay and Wal-Mart, and I suspect the Bay's days are numbered.

Cap

Owen Gray said...

A good friend of mind worked for the Bay for thirty-three years, Cap. He tells me that the American who bought the Bay is a real estate mogul. The rents from other stores keep the ship afloat.

We'll see how that strategy works out. Generally speaking, though, bricks and mortar players have gone down market.

The Mound of Sound said...


And our government's just-in-time solution, Owen? What, more of the same? More globalism, more free trade fundamentalism, more neoliberalism. It is said that the 1% have moved on. They're no longer investing. They and their corporations are accumulating wealth, not putting it to use. Apparently that's what the nobles used to do in the age of feudalism.

Of late I've been trying to identify where we might be heading in the right direction. How are we moving ahead? What's the plan? The vision.

Maybe the addiction to neoliberalism that our leaders cannot shake is that it relieves them of having to think, having to plan, having to lead. Who needs vision if you can fall back on the "free hand of the marketplace" to guide us? Today we're administered, not led. Trudeau offered vision in the 2015 but, once in office, he jettisoned all those promises and went back to ruling us much as Harper did.

Owen Gray said...

It's as if, having seen the world through Copernicus' eyes, we returned to a flat earth, Mound.

The Mound of Sound said...


I think we're all Vanuatu islanders now, Owen. You look in one direction and, lo, there's a bit of beach gone, claimed by rising seas. Then you gaze in another direction and, damn, there's another bit of beach gone. With apprehension you glance over your shoulder and, yeah, the beach behind you is also going.

The vanishing islands of Vanuatu are an apt metaphor for what's going on, falling apart, in so many ways and forms today. It can be environmental, political, social, cultural, commercial or economic but decline seems to be the new normal. I truly hate having to say that. It's so discouraging and yet it's real.

Steve said...

just one word 3d printing.

Owen Gray said...

We see decline as inevitable these days, Mound. Unlike the old Ulysses in Tennyson's poem we refuse "to strive, to seek to find and not to yield."

Owen Gray said...

Unquestionably, there's a technological revolution going on, Steve. But there are downsides. Now all that plastic is clogging up our oceans and our landfills.