Canada is far from an economic recovery from the pandemic

Canada is far from an economic recovery from the pandemic

However, the first signs of recovery are already there.

More than a year has passed since the pandemic began and the Canadian economy seems to be slowly coming back to normal. The federal government has already approved over 12 million applications for Canada Recovery Benefit (CRB). Salaried workers and the self-employed can receive the benefit if their area of activity was affected by COVID-19. During the second half of February, more than 830,000 people became CRB recipients, with more than 1 million applications approved in the first half of February. As of the end of March, more than 2.3 million more people are receiving Employment Insurance benefits — those who lost their jobs during the pandemic.

Mikal Scuterud, an economics professor at the University of Waterloo, says that despite this situation, many think the Canadian economy is recovering at a dizzying pace.

"It's very difficult to understand what's going on right now," Scuterud says. — In February, we saw some growth in the economy. I think March is even better in that regard. But the recovery is very slow."

Some progress is indeed being made. Canada's unemployment rate fell slightly to 8.2% in February. This is the lowest rate since the pandemic was announced in March 2020. Employment increased by 259,000 in February: 171,000 part-time jobs and 88,000 full-time jobs.

But Scooterud urges against targeting the unemployment rate because in Canada it is calculated as the percentage of people not working out of the total labour force, with only people who are employed or looking for work being counted in the labour force. If a person stops looking for a job, they are not counted in calculating the unemployment rate.

"When the economy recovers, there are people who haven't looked for work for a while, and now they start looking," he said. — That will lead to an increase in unemployment, but actually just be a sign that the economy is recovering."

Economy and the removal of restrictions

In many provinces, restrictions previously imposed have been relaxed since the beginning of 2021. This has allowed some non-essential establishments to reopen. But opening establishments doesn't mean establishments make money. Nicky Labori, for example, owns a company that delivers food.

"We're certainly not on the verge of bankruptcy," says Labory, "but we're not making any money either. We just have to work to make sure customers don't forget us.

Even if the economy recovers quickly, it won't be easy for Canadians. Many of those who return to work after a long hiatus feel like they're starting their career from scratch. A study released in October 2020 found that it's especially difficult to find a job after a break of six months or more.

According to Professor Scooterud, this is due to the fact that work often requires skills that are forgotten over time, as well as psychological issues: people lose confidence in themselves as professionals, get used to living with less money or adjust to a different life, for example, by moving in with their parents. People who have somehow changed their lifestyle due to lack of work may find it much harder to get back on their feet.

  • #canada news
  • #canada economy
  • #pandemic
  • #coronavirus pandemic
  • #COVID-19 pandemic
  • #COVID-19
  • #coronavirus
  • #COVID-19 in Canada
  • #economic recovery
  • #crisis
  • #crisis in Canada