Just this monday, Ontario Premier Doug Ford announced parts of Ontario would be moving onto stage 3 of reopening. Although this process wouldn’t include the highly populated areas around the GTA, it’s nonetheless a step in the gradual reopening from a lockdown that has sheltered Canadians since mid-march. Assuming we don’t experience a second wave, the reopening means that economic conditions can start to return to pre-pandemic levels. Here are three reasons why reopening the country is beneficial to Canadians:
The 3 Reasons
#1: Decrease unemployment
If you force workplaces to close, of course you should also expect an increase in unemployment. The inverse is also true, and with the reopening of many restaurants and bars (an estimated 1.2 million Canadians work in the restaurant sector according to a 2017 study), this also means that millions of Canadians can return to work. The returning workers can expect to be greeted by an extremely sanitized workplace along with plenty of ppe, all to ensure that the spread doesn’t go haywire and force shops to reclose. Reopening also means that consumers will have more places and opportunities to spend their money, therefore increasing consumer spending. Although the pandemic has caused the average Canadian to save more money than usual, it’s yet to be seen if that trend can continue post-pandemic.
#2: Consumer spending
To expand on the point of consumer spending, on March 31, consumer spending was tracked to have a 37% decrease compared year-to-year. By the end of June, consumer spending was shown to have increased to 4.7%. Just like the stock market, consumer spending saw a huge comeback from the depths it experienced in late march. Moreover, small business spending is picking back up, going from -27.6% to just -10.4% from april to june. Although this is a step in the right direction for the Canadian economy, it’s unclear how much spending is being stimulated from the emergency funds the government has injected into the economy for the past few months. It’s possible that spending continues even past october, when CERB payments are set to shut off, but you also shouldn’t be too surprised if we see spending level off come the winter months as the extra money stops coming in.
#3: Rent Payments
Back during the announcing of stage 2 reopening, Ford also addressed the issue of commercial rental payments, and announced that from June to August, Canada will ban the eviction of any small businesses that qualify for the Canada Emergency Commercial Rent Assistance program(CECRA). Ford recognized that small businesses got the worst of the pandemic, and so rent relief was one way to compensate. Now that parts of the province are moving into reopening and small businesses are opening their doors again, there’s some hope that these businesses can stockpile some earnings and so when it comes time to pay their dues, shops won’t be forced to close down. Although restaurants were allowed to serve takeout throughout the pandemic, for most stores that simply represented a fraction of what they’d normally earn. With the stores actually reopening, expect earnings to gradually increase in the coming months as Canadians get used to being in the great outdoors again.
Overall, reopening Ontario is a step in the direction of revitalizing the province’s economy. With jobs coming back, consumer spending going up, and businesses reopening their doors, one can only hope that everything goes back to normal. With talks of a second round of virus, optimism is kept at a minimum as we wait and see if a resurgence of cases (like in the states) could happen here in our own backyard and force us to close again. Until then, stay safe, and if your favourite local restaurant happened to reopen, it wouldn’t hurt to go and enjoy a meal.