On Monday, the federal government announced the framework for a Canada Emergency Wage Subsidy (CEWS) to support employment by topping up payrolls for employers suffering COVID-19-related drops in revenue. More details came out on Wednesday, including the types of employers it will cover, the pay it will supplement, the size and duration of revenue drop that will trigger eligibility, and the estimated cost.
This is an extraordinary measure — something entirely new on the Canadian landscape. Not surprisingly, more details, including the application process and record-keeping requirements, are still to come. Parliament will need to approve it. It is not too early to say, however, that this initiative will turn out to be central in…
The spread of COVID-19 and public health measures to combat it have delivered an unprecedented shock to Canada’s economy. Businesses and not-for-profits are closing. Recent Employment Insurance (EI) claims suggest the unemployment rate is headed for double digits.
The economic distress is compounding the direct impact of the disease, and may ultimately overshadow it. Unemployment and financial distress hurt physical and mental health, and the implosion of the private-sector economy is propagating that damage. So just as Canadian policymakers must mitigate the health impacts, they must mitigate the economic impacts.
Governments elsewhere have stepped in to support jobs with direct wage subsidies. Canada’s federal government…
COVID-19 poses a threat to Canada’s economy that is unique in modern times. People are self-isolating, businesses and not-for-profits are cutting back or closing, and workers are losing their jobs. The consequences – including the health impact of unemployment, isolation and lost access to goods and services – could rival those of the coronavirus itself.
Governments have responded with measures that proved useful in the 2008-09 financial crisis. Lower interest rates, liquidity and credit-market supports will all help.
Also important are steps to ease the cash-flow crunch that threatens chain reactions of private-sector closings and layoffs. Federal, provincial and local governments are deferring remittance and filing…
