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Economy

Economy boost likely from the snowbirds – Chemainus Valley Courier

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The fall and winter could be unexpectedly prosperous for businesses in the Cowichan and Chemainus Valleys and throughout the B.C. South Coast.

The snowbirds won’t be making their way south this year in the usual numbers due to the coronavirus, opening the door for numerous possibilities for our region. Many will still look at air travel to escape to Arizona, Mexico, California, Nevada and all those sunnier climes, but those accustomed to driving are having to stay home due to the continued Canada-U.S. border closure except for essential travel. Cars can be shipped down and owners can rendezvous with them later after taking a flight, but it’s a big undertaking.

Those snowbirds already living in the vicinity will be staying at their homes while others from across Canada with harsher winters are likely to consider the B.C. coast for the short term since it has the most temperate climate in the country.

R.V. parks in the Victoria area are already filling up fast, if not already, and some of that traffic is sure to spread to communities around the Island. Availability is certain to become an issue and that’s good news for park owners who might not otherwise be looking at full lots.

At the same time, the active snowbirds have to find something to do and they’ll be frequenting cafes and restaurants for numerous meals throughout the winter months and the grocery stores to stock up on supplies needed for their R.V.s. They’ll also be scoping out the coffee shops.

Wineries could benefit significantly with an increase in visits to the many vineyards throughout the region, both to purchase product and take in the wonderful surroundings.

Spin-offs to other businesses, depending on restrictions, will create more spending.

A busier end to 2020 and start to 2021 will be welcomed by many retailers as well. They might be able to make up for some lost ground during the pandemic.

At least there’s a bit of a silver lining to the continued presence of the virus that’s affecting our every move. Normalcy is a long way away and the snowbirds will be adapting to a new environment, but it’ll be good for our local economy.

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Economy

Are more steps needed to help the economy recover? – CityNews Toronto

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We saved our economy in Sweden. But too many people died. – The Washington Post

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When the coronavirus pandemic gained momentum in the spring, Sweden chose a less restrictive containment strategy than most other countries did, including its Nordic neighbors. Some medical experts and economists, in and out of Sweden, have criticized its policy for being too lenient. Others, from Elon Musk to National Review columnists, have hailed it as a role model for allegedly keeping the economy open, staving off the consequences of a harsher lockdown. President Trump’s medical adviser Scott Atlas has advocated that the United States adopt the Swedish approach to the pandemic.

Sweden’s strategy indeed likely helped the economy — but this came at too high a cost, in terms of lives lost. Taking a similar approach in the United States would, in all probability, be even more costly, because unlike Sweden and other European countries, the United States does not have a centralized, publicly funded health-care system with universal coverage.

Observers outside of Sweden have often misunderstood its handling of the pandemic. It is true that the government never imposed a formal lockdown and that day-care centers and elementary schools remained open. But the Public Health Agency has strongly recommended social distancing, working from home and avoiding unnecessary travel, among other precautions; compliance was high. The agency instructed people above 70 years of age to avoid socializing with others, and visits to old-age homes were banned. The government prohibited public gatherings of more than 50 people. The Swedish summer holidays, when many people leave the cities and towns for their summer houses in the countryside, may have worked as an informal lockdown, slowing the spread of the virus.

Even for observers within Sweden, it has been difficult to ascertain the rationale behind its pandemic strategy. Throughout, the Swedish Public Health Agency remained reticent about the motives behind its policy approach. Officials did not explain how they weighed economic considerations and wider public health concerns, and whether they drew up policies with an objective of achieving herd immunity or based on a worry that rigorous restrictions would be unsustainable.

It might be most accurate to characterize the Swedish “strategy” as one that began with misjudgments of the risk of large-scale spread and the extent of asymptomatic contagion. The health agency did not try to dissuade families from going skiing in the Alps during the winter holidays in late February, though reports regarding an outbreak in northern Italy soon surfaced. A recommendation to avoid unnecessary travel to that region did not come until March 6. When travelers from the skiing resorts returned, they were not quarantined. In media interviews, representatives of the health agency even criticized employers who, on their own initiative, quarantined personnel returning from hot spots. The other Nordic countries imposed limits on public gatherings of five to 10 people in mid-March, but Sweden did not introduce its much higher limit until the end of the month. Even as infections surged in April and May, test-and-trace-programs were not boosted, on the grounds that they would not be effective in a situation with large virus spread. These programs began to be substantially expanded only in the late spring. Very recently, in mid-September, the Public Health Agency recommended, for the first time, that people should quarantine themselves if someone in their household is infected.

What has been the economic effect? Like other countries, Sweden has been hit hard economically. During the first six months of 2020, the gross domestic product fell by 8.5 percent. Unemployment is projected to rise to almost 10 percent in the beginning of next year.

The drop in GDP is considerably smaller than in southern European countries and the United Kingdom, and one to three percentage points smaller than in Denmark, Germany and the United States. The GDP fall, however, is larger than in Finland and Norway. It’s difficult to meaningfully evaluate the impact of different coronavirus strategies using this metric, because of the differences between the countries’ economic structures. For example, Sweden depends less on tourism, an industry hit particularly hard by the pandemic, than do Italy and Spain. Still, the lenient Swedish approach to the pandemic, involving fewer formal restrictions, likely did dampen the economic impact of the pandemic.

But the death toll here has been much higher than in our Nordic neighbors. As of Tuesday, the cumulative number of deaths from coronavirus infections per million people was 52 in Norway, 64 in Finland, and 118 in Denmark, according to Johns Hopkins University. In Sweden it was 581 — not that far below the United States with 673. Comparisons of infection rates are less reliable because of differences in the testing volume, but here, too, Sweden stands out, relative to its neighbors. Registered cases in Sweden are slightly above 106,300, compared with around 13,800 in Finland and 16,600 in Norway — each with about half the population of Sweden.

Have the economic gains from the Swedish strategy been worth the cost? The following are crude back-of-the-envelope calculations.

Assume that the differential Swedish approach dampens the GDP fall this year by 1 percentage point. This represents a gain of approximately $5.6 billion. Also suppose that the approach has caused 5,000 extra deaths — a reasonable guess from comparisons with other Nordic countries. How could one estimate that loss of life in economic terms? The value of a statistical life, used by the Swedish Transport Administration in its cost-benefit analyses of investment in traffic security, is approximately $4.6 million. Using this number, the economic cost of lost lives would be as high as $22.9 billion — clearly outweighing the benefits from the smaller GDP fall. One might argue that the value of lost lives should be set much lower, as the vast majority of deaths have been among elderly people, with fewer years left to enjoy life: 89 percent of the dead in Sweden have been above 70 years of age, and 67 percent above 80. One reaches the break-even point in my calculation if one lowers the value of an average life lost to $1.14 million. For the Swedish approach to be “profitable,” the average life lost must be valued lower than that.

A more complete analysis should consider other factors as well: future health consequences for covid-19 patients, the crowding out of other medical treatments during the pandemic, and the benefits of maintaining a more normal life and keeping more people attached to the labor market. But even a simple calculation, looking only at lives lost, suggests that the costs of the so-called Swedish “strategy” were too high. One thing Sweden may perhaps have done right was to keep day-care centers and elementary schools open. Closing them would have prevented many parents from working, at great cost to their economic output and their livelihoods, and to pupils’ opportunities to learn. There appears to be no evidence that these institutions played an important role in spreading the virus in Sweden: An early study found that day-care personnel and teachers were not at higher risk of infection compared with the labor force in general. There is clearly a need, however, for more research into the potential role of schools in viral spread, in Sweden and elsewhere.

The jury is still out on how well Sweden copes with the pandemic in the longer run: Case numbers, hospitalizations and deaths fell to low levels in August and early September but are now rising again. Based on the numbers so far, however, it appears that Sweden’s failure to adopt a more cautious approach in the early phase of the pandemic caused an unnecessarily large number of deaths, most of them among the elderly. In my view, one would have to attach an unreasonably low value to their lives to conclude that the economic gains outweighed the human losses.

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Economy

Top officials and business leaders discuss a possible 'reset' for the global economy – CNBC

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The coronavirus pandemic has disrupted the global economy and put millions of jobs on the line in the process. With that in mind, some of world’s top economic officials and business leaders are debating how to recover from the crisis in a way that looks beyond mainstream financial metrics like GDP.

Hear from European Commissioner for the Economy Paolo Gentiloni, OECD Secretary-General Angel Gurria, World Economic Forum Managing Director Saadia Zahidi, Unilever CEO Alan Jope and Manpower CEO Jonas Prising on how they’re thinking about an economic “reset,” in a WEF panel hosted by CNBC anchor Steve Sedgwick.

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