Underground economy thrives in crisis

“An underground economy is any kind of economic activity that you don’t report to the government,” explains Charles Scott, who teaches Business at UNBC. “So when the plumber comes over and says ‘Well, the price is this unless you’re going to look for a receipt. In which case it’s that.’ The minute they have to report it and pay taxes on it, it’s an above ground, observable economy. Observable to government and, therefore, taxable.”

Because of its very secret nature, he says it’s impossible to put a dollar figure to how big the underground economy is, but in Italy, it represents roughly 30 per cent of that country overall economy.

And, in times of crisis, it only gets bigger.

Landon says he still gets calls from customers wanting a cut and style. He says he doesn’t have it in him to try opening his doors.

“I’m sure home salons would be much more inclined because you only deal with one client at a time. They can space out their clients to much greater distances. But they’re still putting themselves at risk.”

He hopes that, if everyone plays by the rules, he and others can open their doors sooner rather than later.

by Cheryl Jahn

Underground economy thrives in crisis

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