The Tale of Two Cities
In recent weeks, we have seen the considerable human and economic toll of the coronavirus on global and Canadian financial markets with the hardest hit being the manufacturing, oil and gas, tourism, hospitality and travel industries. Global supply chains are continuing to feel the reverberating effect of the COVID-19 pandemic and will do so for months, perhaps even longer. The working from home and social distancing environment that is upon us is also testing the premise of the “changing nature of work” and the social safety net of the “gig economy” as never before.
Beyond the urgent concerns about the health of workers and their families, the coronavirus and the ensuing economic shockwaves are being felt on the labour market in three ways: 1) increased layoffs and the need for social protection measures; 2) the latent impact on wages; and, 3) the impact on vulnerable groups in times of adverse labour market conditions.
In recent response to such dire consequences, many governments around the world have announced economic stimulus packages to safeguard jobs, guarantee wages, and support the self-employed. Canada has particularly been responsive to this call for action, but time will tell how effective these measures are in enabling business resiliency in the face of such economic tremors.
The impact on the digital and innovation-laden sectors in Canada is also noteworthy, especially on Micro and Small to Mid-Size Enterprises given their inherent reliance on debt to finance R&D and attract highly skilled labour.
Indications are that in these challenging times many businesses are compelled to look for alternative supply chains, heighten their reliance on lights-out manufacturing (heavily automated), and leverage low energy and carbon neutral processes. The potential risk however is that the combination of the lower Canadian dollar and declining market capitalization may make many Canadian businesses ripe for foreign buyouts. Maintaining the ownership of intellectual property in Canada will be critical going forward.
The effects of this pandemic may be far reaching but such jolts to our economy will compel us as a nation to reflect on how best we can shape our world post COVID-19. Larger questions about the efficacy and preparedness of our health system, education and training, trade and transportation, communications systems, urban planning and sustainable communities, are all but many of the questions we at ICTC will be exploring in the coming months in our webinars, whitepapers, and as part of the “Shaping Canada’s Aspirations for a Competitive 2030 Digital Based Economy” initiative we recently launched in partnership with ITWC.
As the per the famous novel by Charles Dickens, “It was the best of times, it was the worst of times, it was the age of wisdom”. We are certainly amidst unprecedented times that require our collective wisdom to shape Canada’s future. The current events are an opportunity for us as a nation to shape better outcomes for Canada in the coming months that are resilient to future economic shocks, be it from pandemics, climate change, or cyberthreats. Accelerating an economic recovery plan that is anchored in technology and skills will be critical in asserting Canada’s place on the world stage.
Finally, our deepest sympathies go out to all the families and loved ones of those effected by these trying times. Our sincere gratitude also to all the frontline heroes, our health-care workers and first responders in the fight against the COVID-19.