Thanks to the coronavirus pandemic, the world is shifting from a sharing economy to a safety economy. As consumers emerge from their homes, they seem to be opting for the solitary and hygiene of their own cars, bicycles and walking. Even as economies reopen, given the new priorities, mass transit and other modes of urban transportation can look forward to tough times.
But it’s not all bad news. One mode hat will not have to wait for herd immunity is micromobility, a term used to refer to bicycle- or scooter-sharing enterprises. These services are already seeing riders return — for some cities, in increasing numbers. The reason? Bicycles and scooters are used outdoors, allow for social distancing and can be wiped down before use.
According to a recent eight-nation survey Oliver Wyman conducted with some 6,000 respondents, 44 percent of riders said they would be willing to increase their dependence on the service in the future and 34 percent said they planned to use it as much as before the pandemic. Only 22 percent said they would decrease their use. Additionally, over a third of non-users said they were equally or more willing to try the service.
Initially, the pandemic prompted some micromobility startups to close down operations in the face of stay-at-home orders, and demand pretty much dried up, according to a New York Times analysis of credit card data. That decline in ridership was driven as much by corporate decisions to shut down operations as it was by the pandemic. Resuming operations in bigger cities may be a smart first step to lure many riders back to the service. Those that have are seeing better numbers, attributed in large part to essential workers. In New York City, Citi Bike expanded service during the pandemic into the Bronx because essential workers needed alternatives to mass transit to get to their workplaces. Capital Bikeshare in Washington, D.C., also announced plans to expand. Both operations never closed during the pandemic, and both saw demand throughout.
Filling the gap
In the meantime, shared mobility services have had to look for revenue alternatives. To compensate for decreased ridership, some companies are adding or expanding delivery services for such items as food, medical supplies and groceries.
Even before the pandemic, several large ride-hailing and scooter-sharing operations established relationships with popular food delivery services to enhance revenue. The pandemic made last-mile delivery more important to most city dwellers, looking for ways to get food, pharmaceuticals and other essentials without leaving the safety of home. For instance, in our survey, 42 percent of respondents said they were using online grocery shopping and food delivery services more or for the first time.
The new revenue from these operations is helping, but it is probably not enough to compensate for the decline in ridership caused by the coronavirus. For many ride-hailing companies, even a doubling of their food delivery business would only partially offset the double-digit drop in ridership globally.
Modeling safety
Contrary to what one might expect, the sharing and safety economies need not be at odds. Mobility companies that embrace a heightened focus on safety and work to reassure riders that they are watching out for their health are the ones that will emerge the strongest. For instance, many bicycle- and scooter-sharing enterprises announced implementation of extensive cleaning protocols, which include wiping down and spraying equipment regularly.
To compensate for decreased ridership, some companies are adding or expanding delivery services for such items as food, medical supplies and groceries.
Similarly, ride-hailing companies altered their business model because of the pandemic, switching to door-to-door, single-passenger rides while discontinuing ride-sharing services. Despite continuing pandemic-related challenges, our survey shows that many travelers will come back to ride-hailing and car-sharing, with most saying they plan to use these services the same or more after the pandemic.
Respondents from countries where the pandemic was the worst were the least enthusiastic about returning to shared mobility modes, with respondents from Spain being the most negative about shared mobility services. In Singapore, where the pandemic has only killed 30 people, there was much less resistance to the idea of using them during and after the pandemic.
Based on our survey, it’s clear that the sharing economy has not retreated so much as it has morphed. In the new environment, micromobility looks set to take off as cities and consumers embrace its benefits.
Alex LaValle, an associate at Oliver Wyman, contributed to this report.
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.
