A woman wearing a protective face mask walks past the boarded up shops along Robson Street in downtown Vancouver, May 4, 2020.
JONATHAN HAYWARD/The Canadian Press
B.C. Premier John Horgan will outline plans to reopen the provincial economy on Wednesday in what his government hopes is the end of the beginning of the pandemic.
His minority government has held power, against the odds, since the summer of 2017, with an agenda that focused on climate action, Indigenous reconciliation and social justice. On Wednesday he will have to pivot to an agenda designed to rebuild an economy being hammered by a domestic lockdown and a looming global recession.
In February, just as the very first cases of COVID-19 were being detected in British Columbia, the B.C. government delivered a Throne Speech that celebrated its efforts to increase affordable housing, open new child-care spaces and improve public transit.
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In March, the government declared a state of emergency and 132,000 jobs were lost because businesses were shuttered by government or physical distancing measures encouraged British Columbians to stay home.
The Business Council of B.C. forecasts the province’s economy will contract by somewhere between 7 and 12 per cent this year. The best-case scenario envisions that most businesses resume operations by the fall. In the worst-case scenario, the pandemic surges again in the fall, leading to another round of restrictions and closings. In any event, more job losses are yet to come: B.C. could lose between 180,000 and 300,000 jobs this year.
Still, British Columbia did not shut down the economy to the same extent as Quebec, Alberta and Ontario. Many B.C. businesses were declared essential, and major sectors including manufacturing and construction have continued with physical distancing measures in place. This week, the government declared that the spread of COVID-19 has been contained enough to allow for an easing of its restrictions.
Mr. Horgan’s government has set aside a $1.5-billion recovery fund, and will now have to make a choice: Will that money be spent trying to repair the economy that was, or will the government seek to lay a different foundation?
Economist Jock Finlayson, chief policy officer at the Business Council of B.C., said the recovery will require the government to find a new focus.
“Digging out from the huge crater our economy and job market have fallen into will be a Herculean challenge for the next couple of years. Among other things, it will require a different approach to priority-setting by the Horgan government,” he said.
Mr. Finlayson said B.C.’s New Democratic Party government has taken the economy and the job market for granted, while putting its energy into files such as affordability, climate change and reconciliation. “That will have to change now, as we slowly and hesitantly emerge from the worst economic slump in modern times.”
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However, Mr. Horgan’s minority government rests on the support of the B.C. Green Party caucus. Interim Green leader Adam Olsen said the government cannot put reconciliation or climate action on the back burner. “I don’t see a world in which you can set those aside,” he said.
Rather, Mr. Olsen said, the pandemic has created an opportunity to rebuild a better province based on the province’s existing climate action plan, called Clean BC.
“We’ll be judged on the decisions that are made in the next couple of months,” he said. “Clean BC outlines a needed transition in our economy. I think it would be wrong to take a step back.”
Merran Smith, executive director at environmental think tank Clean Energy Canada, agreed. “Our climate action plan is a great blueprint for shovel-worthy projects,” she said. She expects the government to use some of its pandemic recovery fund to expand Clean BC programs.
“Whether its electrifying more in our cities so that there’s less pollution or getting people back to work by accelerating housing retrofits, or building more social and affordable housing that’s energy efficient – these are all great opportunities for us to build a better-than-normal economy.”
Laird Cronk, president of the BC Federation of Labour, said the government does not need to move away from its pre-COVID-19 agenda to rebuild the economy.
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“There’s an opportunity through all the difficult times for a reset of what we want this province to look like,” he said.
Most of the job losses have been in the private sector and he said it is expected that money will flow to help rebuild those businesses.
“But it’s also an opportunity for government to play a significant role in putting people back to work and using government stimulus to restart the economy, consistent with their values and goals.”
OTTAWA – Canada’s unemployment rate held steady at 6.5 per cent last month as hiring remained weak across the economy.
Statistics Canada’s labour force survey on Friday said employment rose by a modest 15,000 jobs in October.
Business, building and support services saw the largest gain in employment.
Meanwhile, finance, insurance, real estate, rental and leasing experienced the largest decline.
Many economists see weakness in the job market continuing in the short term, before the Bank of Canada’s interest rate cuts spark a rebound in economic growth next year.
Despite ongoing softness in the labour market, however, strong wage growth has raged on in Canada. Average hourly wages in October grew 4.9 per cent from a year ago, reaching $35.76.
Friday’s report also shed some light on the financial health of households.
According to the agency, 28.8 per cent of Canadians aged 15 or older were living in a household that had difficulty meeting financial needs – like food and housing – in the previous four weeks.
That was down from 33.1 per cent in October 2023 and 35.5 per cent in October 2022, but still above the 20.4 per cent figure recorded in October 2020.
People living in a rented home were more likely to report difficulty meeting financial needs, with nearly four in 10 reporting that was the case.
That compares with just under a quarter of those living in an owned home by a household member.
Immigrants were also more likely to report facing financial strain last month, with about four out of 10 immigrants who landed in the last year doing so.
That compares with about three in 10 more established immigrants and one in four of people born in Canada.
This report by The Canadian Press was first published Nov. 8, 2024.
The Canadian Institute for Health Information says health-care spending in Canada is projected to reach a new high in 2024.
The annual report released Thursday says total health spending is expected to hit $372 billion, or $9,054 per Canadian.
CIHI’s national analysis predicts expenditures will rise by 5.7 per cent in 2024, compared to 4.5 per cent in 2023 and 1.7 per cent in 2022.
This year’s health spending is estimated to represent 12.4 per cent of Canada’s gross domestic product. Excluding two years of the pandemic, it would be the highest ratio in the country’s history.
While it’s not unusual for health expenditures to outpace economic growth, the report says this could be the case for the next several years due to Canada’s growing population and its aging demographic.
Canada’s per capita spending on health care in 2022 was among the highest in the world, but still less than countries such as the United States and Sweden.
The report notes that the Canadian dental and pharmacare plans could push health-care spending even further as more people who previously couldn’t afford these services start using them.
This report by The Canadian Press was first published Nov. 7, 2024.
Canadian Press health coverage receives support through a partnership with the Canadian Medical Association. CP is solely responsible for this content.
As Canadians wake up to news that Donald Trump will return to the White House, the president-elect’s protectionist stance is casting a spotlight on what effect his second term will have on Canada-U.S. economic ties.
Some Canadian business leaders have expressed worry over Trump’s promise to introduce a universal 10 per cent tariff on all American imports.
A Canadian Chamber of Commerce report released last month suggested those tariffs would shrink the Canadian economy, resulting in around $30 billion per year in economic costs.
More than 77 per cent of Canadian exports go to the U.S.
Canada’s manufacturing sector faces the biggest risk should Trump push forward on imposing broad tariffs, said Canadian Manufacturers and Exporters president and CEO Dennis Darby. He said the sector is the “most trade-exposed” within Canada.
“It’s in the U.S.’s best interest, it’s in our best interest, but most importantly for consumers across North America, that we’re able to trade goods, materials, ingredients, as we have under the trade agreements,” Darby said in an interview.
“It’s a more complex or complicated outcome than it would have been with the Democrats, but we’ve had to deal with this before and we’re going to do our best to deal with it again.”
American economists have also warned Trump’s plan could cause inflation and possibly a recession, which could have ripple effects in Canada.
It’s consumers who will ultimately feel the burden of any inflationary effect caused by broad tariffs, said Darby.
“A tariff tends to raise costs, and it ultimately raises prices, so that’s something that we have to be prepared for,” he said.
“It could tilt production mandates. A tariff makes goods more expensive, but on the same token, it also will make inputs for the U.S. more expensive.”
A report last month by TD economist Marc Ercolao said research shows a full-scale implementation of Trump’s tariff plan could lead to a near-five per cent reduction in Canadian export volumes to the U.S. by early-2027, relative to current baseline forecasts.
Retaliation by Canada would also increase costs for domestic producers, and push import volumes lower in the process.
“Slowing import activity mitigates some of the negative net trade impact on total GDP enough to avoid a technical recession, but still produces a period of extended stagnation through 2025 and 2026,” Ercolao said.
Since the Canada-United States-Mexico Agreement came into effect in 2020, trade between Canada and the U.S. has surged by 46 per cent, according to the Toronto Region Board of Trade.
With that deal is up for review in 2026, Canadian Chamber of Commerce president and CEO Candace Laing said the Canadian government “must collaborate effectively with the Trump administration to preserve and strengthen our bilateral economic partnership.”
“With an impressive $3.6 billion in daily trade, Canada and the United States are each other’s closest international partners. The secure and efficient flow of goods and people across our border … remains essential for the economies of both countries,” she said in a statement.
“By resisting tariffs and trade barriers that will only raise prices and hurt consumers in both countries, Canada and the United States can strengthen resilient cross-border supply chains that enhance our shared economic security.”
This report by The Canadian Press was first published Nov. 6, 2024.
