COVID-19 has made economic forecasting an increasingly dicey and difficult endeavour. Most forecasts, however, suggest 2022 will see a continuation of slow but steady recovery as vaccine booster-shots and rapid tests are being distributed and both business and consumer confidence builds. As we look ahead to 2022 and what we hope is the end of the ever-repeating lockdowns, followed by reopening initiatives, and a gradual easing of COVID-19’s grip on our country, there is still uncertainty in what lies ahead for the business community.
The main issue touching all sectors of our economy – SMEs, non-profits, and even bigger corporations — is Economic Recovery. Our economy needs the private sector to flourish and drive growth again, but while it is coping with the impact of COVID-19, continued government support, especially to the hardest-hit sectors, will be essential in 2022.
We applaud the current government’s work to help SMEs get through the COVID- 19 pandemic. The federal government has provided several good benefits through the first two years of the pandemic, including the Canada Emergency Wage Subsidy, Canada Emergency Rent Subsidy, and Canada Emergency Business Account. Some ongoing level of federal support is still required, and it can’t push business owners further in debt.
We agree that there are signs of life in the economy – The Conference Board of Canada forecasts real GDP to grow by 2.4 per cent in 2022, and 0.9 per cent in 2023, TD reports employment is now above its pre-pandemic levels, our population is growing at a rate we have not seen since the early 1970’s, immigration is returning despite border restrictions, retail spending has returned. Yet the majority of our small and medium businesses are still struggling to recover, and any budgetary item must recognize the current fragility of the business sector.
Businesses have faced and continue facing unprecedented threats – COVID recovery for the hardest hit sectors (tourism and hospitality, event and entertainment sector, not-for-profits and charities), severe labour shortages across the board, an inability to invest and grow a business because of short-term financial concerns brought on by the pandemic, supply-chain issues, and more.
Now is one time when we need a balanced approach between strategic spending and saving as the country recovers from the pandemic. Big picture-thinking that takes into consideration return on investment and other metrics is required in this situation.