RECOVERY HOPES RIDE ON RESTART B.C. PLAN
‘Staggering’ number of job losses highlights difficulty of the road ahead
There was no downplaying the latest job numbers for B.C. from Statistics Canada on Friday.
“We use the word ‘unprecedented’ a lot,” said Finance Minister Carole James. “But it’s hard to find another descriptor for what we’re going through. Unemployment usually is a gradual shift. These numbers really are staggering.”
Back in February, when James tabled her balanced budget and three-year fiscal plan, B.C.’S unemployment rate was five per cent — the lowest in the country.
Now, according to the April labour force survey from Statcan, it is 11.5 per cent. After losing 132,500 jobs in March, the province lost a further 264,100 in the following month, for a total of 396,500.
Or in round numbers, 400,000 jobs gone in the space of two months. That took the employment level back to where it was in 2006, when B.C. had almost one million fewer people.
No less sobering was the realization that all those jobs were lost while B.C. was under less of a lockdown than some other jurisdictions.
While construction and some other sectors were allowed to keep operating, other parts of the economy stood fully exposed to the collapse of tourism and consumer confidence, and to people hunkering down at home.
“The sectors most impacted in B.C. were accommodation and food services, and wholesale and retail trade,” said James. “In total, 47 per cent of the job losses we saw in March and April combined were in these sectors.”
No wonder there was such a quick take-up on the B.C. Emergency Benefit, a one-time tax-free payment of $1,000 to people who lost their jobs because of the novel coronavirus pandemic.
Since online applications began a week ago, the province has already processed and approved more than 400,000 applications. The majority of the $400 million worth of payouts have already been deposited in applicants’ bank accounts, said James.
For all the gloom that’s attached to the Statcan labour survey, James nevertheless professed to see “some light at the end of the tunnel.”
She and her colleagues in the NDP government are staking their hopes on the Restart B.C. plan, rolled out Wednesday by Premier John Horgan. “A gradual, cautious lifting of restrictions,” James called it.
Were the latest job loss numbers the worst of it, then?
“I certainly don’t have a crystal ball,” replied the finance minister. “But now that we have started our gradual restart on the economy, we will be watching very carefully in the months of May and June.
“I do expect you will see that a number of businesses will open. But again, that will be up to the individual businesses to take a look at their sector plan, to take a look at how they can meet that plan within their own business and make those calls as individual businesses.”
Having said that, she added a double note of caution: “I think we have got a hard road ahead. I don’t want to sugar-coat this. I think it’s going to be a challenging road ahead.”
Restaurants are coming back and some never closed.
There might be a recovery in homegrown tourism, with the restart plan clearing the way for hotels and resorts to open over the summer.
“But international travel is not going to pick up soon,” she said, then repeated it: “International tourism — it looks like it is not coming back over this next year.”
The prospect hits her where she lives, as MLA for the heavily dependent-on-tourism provincial capital.
What about the $1.5 billion that the legislature set aside back in March for an economic recovery plan? Still a work in progress, according to James.
“Spending of that $1.5 billion will depend on the kind of work that needs to happen sector by sector, and in a broad way across B.C. Ministers are meeting with their sectors to get ideas and to bring those ideas forward. And I expect you will see that work go on over the summertime.”
They are even listening to the B.C. Liberals, who’ve proposed a three-month holiday from the provincial sales tax and the employer health tax as a way to jump-start businesses and encourage consumer spending.
One thing that won’t be changing: James rejected outright any possibility that the province should put off the 75-cent hike in the minimum wage, from $13.85 an hour to $14.60, scheduled for June 1.
James said special attention is being paid to helping out youth employment. Those in the 15-24 age group have sustained the largest job losses in percentage terms according to a recent survey from the B.C. Business Council.
The council has also forecast a contraction of seven to 12 per cent in the provincial economy. With B.C. already exceeding the council’s worst-case scenario of 300,000 job losses, the province might be headed for the deeper end of the economic forecast as well.
But much will depend on whether James is right, that the restart plan actually does restart the economy and reverse the job losses.
She was also asked about the impact on provincial revenues. The three-year balanced budget and fiscal plan was vaporized along with all those jobs. But with only six weeks gone in the fiscal year, it was way too soon to say. Wait for the September update, said James, by which time we might know if there really was a light at the end of the tunnel.
They are even listening to the B.C. Liberals, who’ve proposed a threemonth holiday from the provincial sales tax and the employer health tax.