The Globe and Mail reports in its Saturday edition that the COVID-19 pandemic delivered a huge blow to Canada's economy this spring as businesses across the country shut down as part of a broader effort to slow the spread of the COVID-19 virus. The Globe's Matt Lundy writes that real GDP collapsed at an annualized rate of 8.2 per cent in the first quarter, the sharpest drop since the financial crisis of 2008-09.
The lockdowns triggered a historic wave of unemployment, resulting in some three million jobs lost in March and April alone. Now, as provinces allow businesses to reopen, the Canadian economy is showing signs of life, but the labour market is not likely to return to health any time soon.
Companies are finding it is unfeasible to reach previous staffing levels. Sales are weak and customer traffic is low -- often by design due to physical-distancing requirements.
Moreover, workers also have compelling reasons to stay home: virus fears, lack of child care and government income. Frances Donald, chief economist at Manulife Investment Management, fears that when many smaller companies reopen, "they will be able to manage reduced capacity for a segment of time, but eventually will find that it's not profitable."
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