On February 23 U.S. President Biden and Prime Minister Trudeau issued a ‘Roadmap for a Renewed U.S.-Canada Partnership’ stating ‘Both leaders agreed to take a coordinated approach based on science and public health criteria when considering measures to ease Canada-U.S. border restrictions in the future.’ Less than five months later, Washington appears to have lost its copy
(OTTAWA) – November 13, 2020 – The Canadian Chamber of Commerce Chief Economist and Vice-President of Policy, Dr. Trevin Stratton, issued the following statement in response to the release of data from the Canadian Survey of Business Conditions by Statistics Canada today:
“Today we learned 30% of businesses still operating in October no longer know how they can continue to operate under the existing conditions, and a further 11% indicate they can only operate for 3 more months.
The news is quite grim for 40% of Canada’s businesses looking forward, particularly for those businesses operating in sectors at the bottom of a K-shaped recovery.
We now know that our economy will not recover until at least 2022, the most optimistic scenario assuming widespread vaccine deployment by then. The reality is we are in this for the long haul, and we need to start thinking long-term.
With finite public resources available, we need to look carefully at the return on investment of government spending. Some programs are more beneficial than others. Some policies will contribute more to economic growth. Let’s make sure federal spending is focused on quality over quantity.
Policy makers must be laser-focused on the nature of fiscal spending, and those programs must focus on addressing issues in specific sectors. The one-size-fits-all approach to support programs is not sustainable through 2022, and it may not be particularly useful at this stage of the pandemic.
Consider the following data points:
- Close to three-fifths (57.0%) of businesses in the accommodation and food services sector reported that they were unable to take on more debt
- Approximately one-third of businesses in the arts, entertainment and recreation (29.4%) and accommodation and food services (29.2%) sectors reported that they could continue to operate at their current level of revenue and expenditures for less than six months before considering further staffing actions, closure or bankruptcy
- Over half of the businesses in the accommodation and food services (55.6%) and arts, entertainment and recreation (54.9%) sectors did not expect their revenues to be higher over the next three months than over the previous three months
- Over one-quarter of businesses in the arts, entertainment and recreation sector (28.9%) and almost one-quarter of businesses in the accommodation and food services sector (22.5%) expected to reduce their number of employees over the next three months, the highest proportions among all sectors
With the second wave of the virus now in full force, keeping our fiscal powder dry for the longer run and tailoring supports for the most severely affected individuals and businesses should characterize the second wave of support programs.”
About the Canadian Chamber of Commerce – Because Business Matters
The Canadian Chamber of Commerce helps build the businesses that support our families, our communities and our country. We do this by influencing government policy, by providing essential business services and by connecting businesses to information they can use, to opportunities for growth and to a network of local chambers, businesses, decision-makers and peers from across the country, in every sector of the economy and at all levels of government, as well as internationally. We are unapologetic in our support for business and the vital role it plays in building and sustaining our great nation.
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