With close to three million confirmed cases around the world, more than 40,000 in Canada, the virus is a severe health emergency. This pandemic poses risk and is one that might not go away for months, even years. While the loss of even one life is a tragedy, what is making the global pandemic even worse is the risk the disease poses to the economy. Especially as full or partial shutdowns appear to be the only way health officials can stem the spread. The pandemic poses risk to the Canadian economy in many ways, take a look below to find out how.
Pandemic Poses Risk to the Canadian Economy
In Canada, the fallout has touched nearly every family to some degree or another. In many ways, the economic ills are even worse than the disease itself. This is not to say restrictions should be lifted as scientists can not agree on the best way to test and trace for the virus.
However, for many, the loss of even one paycheck can lead to disaster. Fortunately, the Canada Emergency Response Benefit (CERB) is starting to make its way into bank accounts. Keep reading below to find out more ways the pandemic poses risk to the Canadian economy.
Job Losses Due to Business Shutdowns
Outside of the problems in the energy sector, Canadian businesses in almost every province will feel the economic impact well after the disease has abated.
Part of the reason is that many of their export markets are also in the throws of dealing with the virus, and this means that orders from overseas have largely evaporated in the past month. Another reason is that a cascade of job losses is bound to impact the ability of Canadian families to pay for the goods and services they were buying before the crisis.
But the economic pain does not end there as many of the items you find in your local shop are imported either from other countries in the NAFTA zone or further afield. As such, exchange rate issues are bound to impact the spending power of many Canadians at a time when their lives and incomes are at stake.
The Energy Crisis
Then we get to the energy sector as the Oil Price War could not have come at a worse time. Not only has demand plummeted almost everywhere, but there are also reports that buyers are quickly running out of places to store the oil they have bought. But the pumps keep pumping, and there have been reports of some buyers getting paid to buy oil. Too bad this will not happen when you try to fill up your truck, but it goes to show how we have gotten into uncharted territory.
What does this mean for the Canadian economy? The signs are not right. Since the outbreak, jobless claims have soared, and while the benefits in Canada are much better than our neighbors to the south, it doesn’t mean that people aren’t suffering already.
Also, businesses are feeling the pain as restaurants, and other “non-essential” services have been shuttered. At this point, most analysts believe that the economy will not bounce back as quickly as one expected. Some believe the economic downturn brought on by the pandemic could last one year or longer.
Seek Out Your Options Now
How can you protect yourself?
- Start by making a list of creditors and start to contact them – by phone first, and then in writing to follow up on your conversation. Make sure that you keep impeccable notes as having a secure paper trail in place will help you later.
- Use this as an opportunity to make a plan, which might include deferring or only making partial payments while the crisis is going on.
- Also, seek out advice from credit counselors on how delayed or incomplete payments will affect your credit score – this includes how to handle the impact of falling behind on your mortgage.
Did you know that just because your bank might be pursuing a power of sale order does not mean that you are helpless? If you don’t know where to start then check out this link to give you a better idea of your rights, known as “stopping the power of sale”.
Also, make sure that you are getting employment insurance and your Canada Emergency Response Benefit (CERB) payments. Delays could be due to issues with your records, so make sure that everything is in order as these government programs are there to help you during a time like these.
Pandemic Poses Risk to Economy – In Conclusion
If you do not have a budget, then set one up pronto. In an emergency such as this, you need to have control over every dollar coming in and going out as it might be the difference between falling behind or surviving the crisis relatively unscathed.
Another idea might be to look at the equity you have in your home as now could be the time to refinance before home values drop – which they will. Keep in mind taking on more debt at the start of a crisis can be a risky strategy, but cash is king, and you need to make sure you have access to all of the cash you can find at this point.
Since the pandemic poses risk to you and those around you, the key to protecting yourself is to act now. There is too much uncertainty surrounding the current situation to sit back and hope for the best.
Are you ready to prepare yourself against this pandemic? Do you already have a plan in place?
AUTHOR LaTia Longuemire
My name is LaTia Longuemire. I enjoy writing, singing, and cooking in my spare time. My passion is helping others. At this stage in my lifetime, I'm primarily focused on my children. They are everything that keeps my world spinning.