An Important COVID-19 Update for Canadian Members

The autumn of 2020 was a tumultuous time in Canadian politics. The government pivoted from a message of recovery to a contingency plan for dealing with the second wave of COVID-19. As cases rose, the virus threatened to get out of control once again across provinces and regions. Instead of a Fall Economic Statement focused on new investments to drive employment up and planning projects for spring 2021, Ottawa amended support programs that sheltered some personal and business finances, albeit with less generosity than in the early days of the pandemic.

Employment has continued to recover, but the pace of recovery has been slow, and the economy's underlying fundamentals continue to leave policymakers concerned. Even if a vaccine for COVID-19 is delivered to Canadians in Q1 or Q2 of 2021, it is expected that only some people will benefit. Ottawa's working assumption is that for the one million+ Canadians who qualify as "long-term unemployed" (six months or more), it will be challenging to transition back into the workforce without significant direction and significant retraining for available work.

At the same time, there are bright spots.

There will be extensive adjustments to education and training that are expected to create more employer incentives to help businesses bring in new apprentices. If the federal government can work around the provinces and create a direct incentive, it will benefit them politically and, at the same time, ensure a faster rollout.

Furthermore, the government has committed to infrastructure investments as a key pillar of its economic recovery plan. So far, there is a clear sense that the plan may not rely as much on traditional roads, bridges, and pipelines as in previous government recovery plans, but that emphasis will be placed on public transit, active transit and urban mobility, and green infrastructure. Simultaneously, these federal signals are being met with pushback from the provinces that are more focused on delivering job-creating infrastructure in traditional sectors for citizens and working with municipalities to deliver those messages.

The municipal governments across Canada are divided. Big-city mayors are pressuring the government to provide them with operating funding to close the gap from lost revenues due to transit fares, traffic tickets and other permits. At the same time, the rural municipalities have made the rollout of new broadband funding their top priority. In both cases, the opportunity exists for some AED members, but the major nation-building projects that we could expect from an economic recovery have been moved further out on the political horizon.

We now look forward to a spring budget where the federal government will be tasked with giving provinces and cities the financial resources to create jobs and bounce back. Across Canada, those decisions will continue to depend on case numbers remaining low or the rapid rollout of an effective vaccine for COVID-19.

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