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Making masks mandatory may save the economy too, Goldman Sachs economist says – CTV News

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4 years ago

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TORONTO —
As more and more jurisdictions order face masks to be mandatory in public places, protests are springing up against the temporary restriction these orders place on individual freedom.

Although generally small and ineffective in changing public policy, the protests have attracted attention for their opposition to what are widely seen as useful measures designed to save lives.

Now, a new group of professionals is entering the fray, arguing that mandatory mask orders aren’t just about protecting public health, but also about rescuing the economy.

Jan Hatzius, the chief economist at Goldman Sachs, released a report last week calling for a national mask mandate in the United States. If the country does not take that step, he argued, it will have to resort to more severe lockdown measures that could shrink the American economy by five per cent.

Investors are already worried about what will happen to the U.S. economy because of fast-rising COVID-19 caseloads in many southern states, Hatzius said.

“What Goldman Sachs is trying to say to people is ‘There is a cost to not getting coronavirus under control,'” Marvin Ryder, an associate professor at the DeGroote School of Business at McMaster University in Hamilton, told CTV News Channel on Tuesday.

“If you don’t get this under control, there are severe consequences. There’s only one choice left, and that would be a severe lockdown.”

Those lockdowns deal a severe economic blow, as businesses close and consumers stop spending money. The Canadian economy plunged by 7.5 per cent in March and an unprecedented 11.6 per cent in April as large parts of the country were shut down to ride out the initial wave of the pandemic. In the U.S., where the measures taken were less strict and more patchwork, the economy still contracted by 17 per cent between January and April, according to Goldman Sachs.

Many countries have made mask-wearing compulsory in at least some public gathering places during the pandemic, including the United Kingdom, France, Germany, Mexico and India. There is no such national mandate in Canada or the U.S., although some individual jurisdictions within each country have enacted similar policies. Wearing a mask in indoor public settings is now mandatory in Toronto and will be later this month in Montreal.

A recent poll conducted by Nanos Research for CTV News found that 54 per cent of Canadians support mandatory masks in all public spaces across the country, with an additional 25 per cent somewhat supportive. Some doctors and public health experts have been pushing for mandatory masks as well, arguing it would be an especially worthwhile initiative in the provinces where COVID-19 remains a greater public concern.

THE ECONOMIC IMPERATIVE

Ryder described the Goldman Sachs report as an attempt to convince those who do not agree with the public health message that there are other advantages to “[giving] up a little civil liberty” and accepting public mask requirements.

“A little compromise here means we can keep the economy going,” he said.

Goldman Sachs’ research found that states that mandated masks saw approximately 25 per cent of their population shift to always or frequently wearing them in public within the first month or so, in addition to those who were already wearing them often.

“[This] suggests that a national mask mandate could increase US face mask usage by statistically significant and economically large amounts, especially in states such as Florida and Texas that currently don’t have a comprehensive mandate and are seeing some of the worst outbreaks,” Hatzius wrote.

The research also found that new COVID-19 case rates fall significantly starting about a week after a state’s mask mandate comes into force, and continue to fall for at least the following month, with death rates decreasing as well.

States without mandatory mask orders accounted for half of the U.S. population but two-thirds of all new COVID-19 cases as of July 1, Hatzius said.

“If a face mask mandate meaningfully lowers coronavirus infections, it could be valuable not only from a public health perspective but also from an economic perspective because it could substitute for renewed lockdowns that would otherwise hit GDP,” he said.

Regardless of whether face masks are mandatory or not, Americans are more likely to wear them in public than Canadians, according to recent polling by British firm YouGov.

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Economy

Minimum wage to hire higher-paid temporary foreign workers set to increase

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October 21, 2024

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OTTAWA – The federal government is expected to boost the minimum hourly wage that must be paid to temporary foreign workers in the high-wage stream as a way to encourage employers to hire more Canadian staff.

Under the current program’s high-wage labour market impact assessment (LMIA) stream, an employer must pay at least the median income in their province to qualify for a permit. A government official, who The Canadian Press is not naming because they are not authorized to speak publicly about the change, said Employment Minister Randy Boissonnault will announce Tuesday that the threshold will increase to 20 per cent above the provincial median hourly wage.

The change is scheduled to come into force on Nov. 8.

As with previous changes to the Temporary Foreign Worker program, the government’s goal is to encourage employers to hire more Canadian workers. The Liberal government has faced criticism for increasing the number of temporary residents allowed into Canada, which many have linked to housing shortages and a higher cost of living.

The program has also come under fire for allegations of mistreatment of workers.

A LMIA is required for an employer to hire a temporary foreign worker, and is used to demonstrate there aren’t enough Canadian workers to fill the positions they are filling.

In Ontario, the median hourly wage is $28.39 for the high-wage bracket, so once the change takes effect an employer will need to pay at least $34.07 per hour.

The government official estimates this change will affect up to 34,000 workers under the LMIA high-wage stream. Existing work permits will not be affected, but the official said the planned change will affect their renewals.

According to public data from Immigration, Refugees and Citizenship Canada, 183,820 temporary foreign worker permits became effective in 2023. That was up from 98,025 in 2019 — an 88 per cent increase.

The upcoming change is the latest in a series of moves to tighten eligibility rules in order to limit temporary residents, including international students and foreign workers. Those changes include imposing caps on the percentage of low-wage foreign workers in some sectors and ending permits in metropolitan areas with high unemployment rates.

Temporary foreign workers in the agriculture sector are not affected by past rule changes.

This report by The Canadian Press was first published Oct. 21, 2024.

— With files from Nojoud Al Mallees

The Canadian Press. All rights reserved.

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PBO projects deficit exceeded Liberals’ $40B pledge, economy to rebound in 2025

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4 days ago

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October 17, 2024

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OTTAWA – The parliamentary budget officer says the federal government likely failed to keep its deficit below its promised $40 billion cap in the last fiscal year.

However the PBO also projects in its latest economic and fiscal outlook today that weak economic growth this year will begin to rebound in 2025.

The budget watchdog estimates in its report that the federal government posted a $46.8 billion deficit for the 2023-24 fiscal year.

Finance Minister Chrystia Freeland pledged a year ago to keep the deficit capped at $40 billion and in her spring budget said the deficit for 2023-24 stayed in line with that promise.

The final tally of the last year’s deficit will be confirmed when the government publishes its annual public accounts report this fall.

The PBO says economic growth will remain tepid this year but will rebound in 2025 as the Bank of Canada’s interest rate cuts stimulate spending and business investment.

This report by The Canadian Press was first published Oct. 17, 2024.

The Canadian Press. All rights reserved.

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Economy

Statistics Canada says levels of food insecurity rose in 2022

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5 days ago

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October 16, 2024

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OTTAWA – Statistics Canada says the level of food insecurity increased in 2022 as inflation hit peak levels.

In a report using data from the Canadian community health survey, the agency says 15.6 per cent of households experienced some level of food insecurity in 2022 after being relatively stable from 2017 to 2021.

The reading was up from 9.6 per cent in 2017 and 11.6 per cent in 2018.

Statistics Canada says the prevalence of household food insecurity was slightly lower and stable during the pandemic years as it fell to 8.5 per cent in the fall of 2020 and 9.1 per cent in 2021.

In addition to an increase in the prevalence of food insecurity in 2022, the agency says there was an increase in the severity as more households reported moderate or severe food insecurity.

It also noted an increase in the number of Canadians living in moderately or severely food insecure households was also seen in the Canadian income survey data collected in the first half of 2023.

This report by The Canadian Press was first published Oct 16, 2024.

The Canadian Press. All rights reserved.

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