FROLITICKS

Satirical commentary on Canadian and American current political issues

Apr 25

In reopening the economy, the labour market will look a whole lot different

by bcurry

As parts of the U.S. and Canada begin to plan for the reopening of their economies, so to speak, one has to expect that longer term changes to the labour market will occur. The shut-downs because of COVID-19 primarily hit certain sectors, especially those in retail, tourism and services comprised mainly of small and medium sized businesses.  As of the beginning of April, more than 7.1 million unique applicants have filed for the $2,000 monthly benefit under the Canada Emergency Response Benefit (CERB). In the U.S. at least 26 million Americans, or 15 percent of the workforce, have applied for unemployment benefits in the past five weeks, effectively erasing all job gains made since the 2008-09 recession. By the end of this month, unemployment rates in both countries will be getting close to double digit figures.

The hardest hit workers are women, part-timers and those in low paying jobs. Many full-time employees have had their hours cut back.  At first, it was the private sector that took the brunt of the job cuts, but now one is seeing similar cuts in the public sector because of the shut-down of various government run services and the loss of tax revenues from both unemployed citizens and closed businesses.  Despite the availability of government financial assistance, both the unemployed and businesses will find it difficult to function as usual even in the event of the reopening of various economic activities.  For many, it may be too late.  Bankruptcies will continue to climb as the closures continue.  In addition, not all sectors will recover at the same rate, or at the same time.

As long as the threat of the coronavirus continues, with some experts predicting continuing waves in the fall, many consumers will be hesitant to frequent restaurants, retail outlets, hair salons, etc., etc. Consumption represents about seventy percent of the gross domestic product.  With many consumers in financial difficulty, they will also be hesitant to begin spending right away.  Then there is the impact of e-commerce on the retail and service sectors.  The use of on-line services by consumers has almost doubled since the outbreak began.  In addition, there has been a change in what we would define as “essential services”.  Suddenly, delivery people and grocery store clerks have been deemed to be essential in order to keep vital services going.  Some have suggested that people joining the essential workforce, because they have been displaced out of their current industries, might choose to remain in those jobs, at least in the near term.

It is anticipated that over the coming year, those manufacturing companies who converted to producing personal protective equipment, sanitizers, ventilators, etc., will continue to do so. There is a lot of uncertainty about COVID-19 and the degree of so-called “herd immunity” that might develop among those who have recovered from the virus.  With no vaccine foreseen in the next year, a return to normal economic activity will have to be cautious with many restrictions remaining in place for businesses and consumers.  The need to protect those who are employed in essential services will continue for months to come.  Moreover, what we might see coming out of this crisis is a very different labour market at least in the short-term.

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Apr 21

The Debate Has Begun About How To Open Up The Country

by bcurry

It’s been over five weeks since Canada and the U.S. began their business, school and other closures and the cancellations of multiple activities, including sporting events, concerts, festivals, etc., etc. By limiting the exposure of citizens to COVID-19 in the community, the authorities had hoped to “flatten the curve” as it pertains to new coronavirus cases, hospitalizations and mortality rates.  In Canada, we now have about 37,000 confirmed cases and almost 1,700 deaths. In the U.S., there are over 2,400,000 confirmed cases and over 42,000 deaths to date. In both countries, health authorities note that the peak has yet to be reached, although there appears to be some affected areas that have begun to plateau in their daily numbers.

National governments, states/provinces and cities have begun to plan for the possible phased-in opening up of their economies. However, before doing so, health authorities are warning that adequate testing for the virus must be in place, physical distancing restrictions maintained and on-going health surveillance of those who have had the virus and survived.  Some have suggested that electronic tracing methods should be implemented to alert individuals who may have come into contact with someone who had tested positive for COVID-19.  This of course raises privacy issues for people who could then be remotely tracked by such technologies.

In addition, a phased-in approach would mean that certain types of businesses and activities would be initially reopened because of the low probability of disease spread. The ability of businesses to control their environment and provide for worker and customer protection and safety would be one key ingredient in determining which would open first, although often in a limited manner.  Many variables and conditions would have to be met in order to minimize the danger to both customers and workers.  This will not happen over night and will require careful and thorough planning on the part of the authorities and business operators.

There is little doubt that as the shutdown has had a devastating impact on the economy and individual’s livelihoods. However, one cannot merely reopen everything at once and various priorities have to be met to avoid a second wave of COVID-19 in the population.  Scientists and researchers need more time to assess issues related to peoples’ immunity, potential effective treatments and eventually a possible vaccine.  Simply protesting the current shut-down and risking one’s life will not change the realities of the situation.  If one goes too quickly, one risks exacerbating the health impact of the disease and overloading the health care systems.  How many more deaths are we willing to risk by moving too fast?  In the interim, for the sake of the community and our loved ones, we can all help by staying home and being safe.

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Apr 14

During this pandemic, working from home is no vacation for most workers

by bcurry

While some employers may view remote workers with suspicion during the current COVID-19 pandemic, the fact is that they are doing the best that they can under very difficult conditions. Imagine, working in a home where one has to care for children and possibly sick persons.  If anything, telework has proven to be a blessing for many businesses where it is feasible and practical.  Not only is it ensuring that one’s employees are a lot safer when self-isolating, various aspects of a business can continue with the support of today’s available technologies.  Indeed, various studies have shown that even under normal circumstances, remote workers can actually be more productive.  Nevertheless, there are paranoid managers who envision their remote workers lying on couches and staring at televisions.

What these managers tend to forget is that workers are more than happy to be doing a job and receiving a regular pay cheque under the circumstances. Out of necessity, they also want to keep their jobs and contribute to the business viability of their employers.  In expectation of eventual business recovery the productivity and commitment of remote workers must be supported during these difficult times.  Even if someone doesn’t take care of a child or sick family member, they still need to care for themselves.  Maintaining one’s mental health is even more important during a pandemic than at any other time.  Employers need to understand and appreciate the daily impact on mental health.

Once the pandemic comes slowly to an end, there is little doubt that some businesses may consider altering their work practices to allow for more remote working. Our workplaces and the way we work will change.  Years ago, when I was working remotely, I noticed a certain reluctance by some managers to implementing various forms of telework.  However, I was just as productive and efficient as I would have been working in an office.  Indeed, I never missed a deadline and the organization was more than satisfied with the final product.  Notably, not having to commute to work every day and having fewer workplace distractions — especially useless meetings — saved a lot of time and anguish.

Today’s workforce is a lot more mobile and technologically advanced. One of the things that the pandemic has shown is that we can operate remotely in efficient and effective ways, especially through teleconferencing.  Yes, the important human factor is always there and various means can be developed to facilitate team work and work relationships.  All of this requires trust on the part of business owners and managers.  The ways in which we evaluate job performance will also need to change.  How much time we spend at work will no longer be a major consideration.  It’s real productivity that will matter the most, whether working remotely or at the office!

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Apr 9

Financially, millennials are being particularly hit hard by the current economic downturn

by bcurry

Millennials (those born between 1981 and 1996) were particularly hit hard by the Great Recession of 2008-9. In their thirties and forties, they were just graduating college at that time and had incurred unprecedented levels of student debt.  With levels of very high unemployment and having to accept lower paying and interim jobs in the gig economy, they also missed out on crucial years of wage growth because of the 2008 downturn.  A decade later, many millennials have built up savings and were preparing to buy a house when COVID-19 hit.  Suddenly, the economy is once again severely hit, unemployment has begun to rise and the predicted recession is expected to last longer and to be as serious as that a decade ago.

A new survey disclosed by the Financial Post indicated that almost three out of five or 57 percent of Canadians have already taken a financial hit from the coronavirus crisis. Younger adults reported feeling the biggest impact, including 67 percent of millennials. In addition, 37 percent of millennials said they have had their hours reduced because of workplace closures, especially in deemed non-essential sectors.  In March, Statistics Canada reported that the jobless rate spiked to 7.8 percent. Most of those Canadians affected by the current downturn said they are concerned about paying their bills, including 78 percent of millennials who represented the largest such affected grouping.  More than half of the people surveyed expected that they would not be able to pay their bills and loans within four weeks.

Millennials, because of their debt burdens and a pricy housing market, had reportedly been slow to dive into home ownership which as we know is a key way to build wealth. As was the case in 2008-9, Boomers ended up staying in the workforce longer than normally expected because of the stock market decline which particularly battered their retirement savings.  As for those in white-collar professions, we once again can expect that millennials will get stymied in career advancement because another recession means Boomers (most now nearing or over 65) won’t retire on schedule.

While all of us must adjust to the realities caused by COVID-19’s impact on the economy and life in general, younger workers will b forced to adjust the most. Despite all of the governments’ financial assistance, there can be no substitute for full-time work and the accompanying earnings, work experience and benefits.  For millennials in particular, the timing of the two crushing events within a decade is especially damaging. Down the road when the economy begins hopefully to recover, both society at large and employers specifically will have to consider the financial and psychological impacts of this recession on millennials.

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Apr 5

It’s Been A Long Time Since We Put So Much Faith in Science!

by bcurry

What does one do when faced with a novel coronavirus? One puts one’s faith in our scientists, researchers and medical professionals.  Firstly, they were the ones through bodies such as the World Health Organization (WHO) who initially alerted us back in December to an outbreak in China of what appeared to be a novel coronavirus. From there, the WHO medical researchers and epidemiologists tracked the virus as it spread to other South Asian countries.  Next, numerous national health organizations like the Centres for Disease Control (CDC) in the U.S. and the Public Health Agency of Canada began their analysis of related data as to how the virus was being spread and its characteristics.

Sometime in February, after the coronavirus hit Italy and Iran, scientists warned our political masters of what appeared to be an emerging global pandemic. Some politicians immediately took their warnings to heart and began to enact various measures, including “social isolation” and travel restrictions to and from so-called “hot spots”.  Other politicians, such as President Trump, downplayed the health dangers involved and were slow to take the advice of the scientists.  Finally, in late March, the epidemiologists had enough data to begin their “modelling” of trends in the contagion and mortality rates.  Such projections are based on what is an inexact science, and they are not really meant to predict the future. However, they do provide a general guide for policy-makers and health-care systems grappling with a growing pandemic.

In this war on COVID-13, the top public health officials and expert scientists are front and center. Administrations greatly rely on them to justify their restrictive measures and administrative policies.  Suddenly, the science has taken a powerful role, unlike in the case of “climate change” where it tends to be either ignored or downplayed.  The next phase will be to ascertain, based on the science and data collected through human testing, when the recovery period from the pandemic will emerge.  Italy is one of the first countries to hopefully reach the start of a plateau in new cases. Here again administrations will depend on the scientists for guidance.  Italian researchers have begun to look at those who have antibodies which prevented serious health impacts or assisted in their recoveries. Using the testing data, although still uncertain, researchers are hopeful that the antibodies may in fact indicate immunity. If such is the case, persons with the antibodies could be allowed to return to their workplaces and normal activities. In New York state, Gov. Andrew Cuomo has already envisioned a potential strategy in which younger people, and people who have antibodies showing they have been cured of the virus, could go back to work.

In the meantime, the invaluable work of scientists to develop effective and safe treatments for COVID-19 is ongoing. Such treatments are most likely still weeks and months from now. In addition, around the globe, researchers are working feverishly on a possible vaccine. Realistically, baring some miracle, a vaccine requiring human trials is a long ways off. In the interim, public officials must continue to implement the precautionary measures needed to limit the impact on our health care systems. They must move immediately to provide front-line workers with the necessary personal protective equipment (PPE) and equipment to cope with the predicted numbers of new cases coming into emergency facilities. Needless-to-say, their safety and health is a priority for them, their families and for all of us.

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Mar 30

Whenever and Wherever It Starts, Economic Turnaround Will Take Time

by bcurry

A recent New York Times article was entitled: “Scary Times for U.S. Companies Spell Boom for Restructuring Advisers.”  Another earlier New York Times article was entitled: Businesses Face a New Coronavirus Threat: Shrinking Access to Credit.” One just has to look around urban centers and rural areas where small and medium businesses have been forced to close to see the economic results.  Hoteliers, retail outlets, cruise lines, restaurants, event sponsors and mortgage lenders are among those suddenly short on cash, with travel and outdoor activity at a standstill and unemployment soaring. Only essential-deemed enterprises and services can remain open on a restricted basis, hardly enough to maintain a society’s economic engine and GDP growth.

A Financial Post article is entitled: “The global oil market is broken, drowning in crude nobody needs.” It goes on to note that the next stage of the oil market’s meltdown will be widespread production shutdowns — and it’s already starting to happen.  As the article also notes, refineries are becoming idle, the pipeline system will soon grind to a halt and storage tanks daily are being filled to the brim. As we know, the global airline industry is grounded, countless businesses and factories are shuttered and billions of people, having been forced to stay home, are no longer driving across the country.

Despite governments pouring aid packages into the economy, personal and corporate bankruptcies are already expected to significantly increase should the pandemic last several more months. We are a consumer-driven economy and consumer consumption is expected to remain low for months to come, especially with the extremely high levels of predicted unemployment and the average family having to struggle just to make ends meet.

We can expect that in the near future things will get worst than better anytime soon. Dr. Anthony Fauci, director of the National Institute of Allergy and Infectious Diseases, now estimates that the pandemic could cause between 100,000 and 200,000 deaths in the U.S.  As of today in Canada, there are over 3,620 confirmed and presumptive COVID-19 cases and just over 60 fatalities. Health authorities believe that both countries have yet to reach their pandemic peak, expected in the next few weeks.  Most governments have extended the mandated isolation periods and travel restrictions into and beyond this April.  Not knowing how long exactly that these measures will be in place makes it all the more difficult to make economic predictions.  All we know for sure is that economic growth will most likely be negative for the coming year and the human toll will continue to be great.  All one can do is take care, be safe and self-isolate wherever and whenever possible.  Working together as communities and families, we can all get through this.

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Mar 18

The COVID-19 Global Pandemic Was Predictable Given Past Experiences

by bcurry

Years ago I read a book published in 2006 by Andrew Nikiforuk entitled “Pandemonium”. What is fascinating was that the author clearly and correctly outlined all of the factors which would lead to a future pandemic.  So here we are in 2020, which now has what must be the worst pandemic since the Spanish Flu of 1918-19.  He laid out the three primary conditions needed to foster a pandemic.  These were: “a just-in-time global economy, unprecedented urban crowding, and unparalleled human mobility.”  He noted that reports by several sources, including the U.S. Congressional Budget Office, concluded that a severe pandemic with a 2.5 percent death rate would “shock the economy” and turn the health-care system completely “upside down.”

Indeed, this is exactly what is happening world-wide. In both the U.S. and Canada, the health-care systems were already at full capacity — and even at over-capacity — because of the usual seasonal influenza outbreaks. The almost total shutdown of the Chinese economy has thrown a huge wrench into normal supply chains and seriously lowered China’s growth rate as the second largest economy in the world. The stock markets are tumbling and growing recession speculation is dominating financial news.  While China may appear to be slowly recovering from its outbreak because of its draconian measures, the rest of Asia, North America and Europe are now in the process of just starting to come to grips with the resulting economic and health impacts.

What’s most worrisome is the fact that we were so caught off guard by the pandemic’s emergence, despite our earlier experiences with avian flu and SARs. There are already shortages of testing kits, personal protective equipment and ventilators needed by health-care workers to do their jobs.  For now, the authorities’ strategy is primarily aimed at simply slowing down the spread of the virus by enforcing the shutdown of businesses, restricting or eliminating travel from other countries, and encouraging “social distancing” by people at large.  The hope is that such measures will limit exposure to the virus and allow the health-care system to cope with the more seriously infected patients.

What is particularly disappointing is the daily news coming out of the U.S.  There you have an administration that started out by understating the impact of the novel coronavirus and a President who even talked about it as a “hoax”.  For a country that is supposed to be an example and leader to the rest of the world, the U.S. has done anything but inspire confidence in its ability to tackle such a formidable foe. The result could be catastrophic for many Americans and for the rest of the world.  Simply calling the impact of the outbreak a “national emergency” may unfortunately be too little and too late for many Americans already in dire straits.

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