As vaccines begin to find their way into arms across the country, Canadians and the businesses employing them are increasingly looking forward to a return to more normal lives and economic recovery.
“For all of the subsidy and stimulus spending Canada has seen and will continue to see, the only path to real, sustainable growth is job creation and business investment. Our members, businesses from Main Street to C-Suite and everything in between, want one thing from this budget: a clear plan to help them lead Canada’s economic recovery. They are ready to kick start our shared recovery, but they need the government to do its part and create an encouraging business environment,” said Perrin Beatty, President and CEO of the Canadian Chamber of Commerce, Canada’s largest business association.
In the short term, the Canadian Chamber has advocated that Canadian Emergency Wage Subsidy and Canadian Emergency Rent Subsidy continue to be available for struggling small businesses, with a few improvements like adjusting the baseline formulas for both programs to account for seasonal businesses and increasing the CERS multi-entity cap to ensure struggling medium-sized businesses are treated fairly.
At the same time, other sectors of the economy that depend on interacting face-to-face with customers are experiencing immense difficulties and are widely expected to be among the last to recover. They will need targeted policies to assist their longer recovery period.
“Canada needs to grow its economic output by approximately $66 billion just to get back to the volume of our pre-pandemic economy,” said Trevin Stratton, Chief Economist at the Canadian Chamber. “That’s about the size of Manitoba’s economy alone. Relying on the growth of only a few sectors will not get us there. We need a recovery that lifts everyone up and that grows all businesses, large and small, from coast to coast to coast. Getting back to normal is just the first step, however. We also need to address more structural issues, like our flagging productivity, which existed well before the pandemic. Government spending and pent-up consumer demand alone will not resolve these issues. Our recovery plan must focus on unlocking business investment.”
As it looks forward, the Canadian Chamber is urging the government to tackle more structural issues within the business environment that, if left unaddressed, will hamper Canada’s economic recovery. These are:
- Helping business create jobs: Even as unemployment remains high, many employers are struggling to hire amid this crisis. The challenge for both employers and job seekers is that they do not have an accurate picture of how the pandemic has affected the labour market. We need a system to better match people, skills and demand.
- Helping businesses get women back to work: The responsibilities for being the primary caregiver fall disproportionately on women. Enhancing affordable childcare will strengthen the ability of women to fully participate in the workforce, especially given the personal choices many have had to make due to COVID-19 related school closures.
- Helping businesses invest in Canada: Budget 2021 can help mobilize domestic business investment and consumer spending to lay the groundwork for an economic recovery. Unfortunately, Canada’s business investment remains among the lowest in the OECD, and with good reason.
- Helping businesses go digital: Expanding broadband investment to accelerate rural 5G development will spur innovation and economic activity in remote areas. At the same time, the stark increase in cyber-attacks throughout the pandemic has highlighted increasing business exposure to cybersecurity threats, including theft of intellectual property.
- Helping businesses reduce the impacts of climate change: Canadian businesses are committed to sustainable growth and attaining our climate targets. We see significant opportunities to create new revenue streams, reduce waste and produce new clean technologies. However, businesses need policy certainty, support for scaled adaptation, and a clear path forward to manage their competitiveness while making emission reductions in the decade ahead.
“As it plans this year’s budget, the government has to differentiate between the must-haves and the nice-to-haves. We know that we can’t cut our way back to fiscal health and inflating our way out of debt would have dire consequences for consumers and all Canadians. The key to getting out of this fiscal quagmire is growth, and that will only come from the private sector. It’s time Canada got serious about helping its businesses create economic growth,” added Beatty.
For more information on the Canadian Chamber of Commerce Budget 2021 submission, click here.
About the Canadian Chamber of Commerce – Because Business Matters
The Canadian Chamber of Commerce helps build the businesses that support our families, our communities and our country. We do this by influencing government policy, by providing essential business services and by connecting businesses to information they can use, to opportunities for growth and to a network of local chambers, businesses, decision-makers and peers from across the country, in every sector of the economy and at all levels of government, as well as internationally. We are unapologetic in our support for business and the vital role it plays in building and sustaining our great nation.