A second wave would be economically grim but plans are in place: Quebec jobs minister
QUEBEC CITY -- If the second wave of COVID-19 hits hard this fall, Quebec's economy, and the public purse, will suffer.
Mass layoffs and big chains shutting down could affect the province’s projected economic recovery. The damage that began in the spring is likely far from over, and it's expected that more government aid will be needed.
The impact on public finances, already undermined by the first wave, will be significant, when cash reserves are no longer what they were in the spring.
But Quebec’s employment minister, Jean Boulet, says he remains optimistic and he maintains the provincial government is ready for any scenario.
“We have plans to deal with any hypothetical,'' he said Thursday at a press conference on another subject.
A GRUELING FALL
He admits that the fall could be difficult for the health of the economy and for public finances.
“Will there be mass layoffs? Yes,” said the minister, when asked what he expected in the event of a serious second wave.
He expects more businesses will close their doors, especially in certain vulnerable sectors such as hospitality, catering, tourism, culture, certain parts of the retail trade and the aeronautics sector.
Boulet predicts that we could end up witnessing a strange phenomenon, with job losses and labor shortages going hand in hand, depending on the economic sector.
He noted that since the start of the pandemic, Quebec has lost 830,000 jobs and, while some have now been reinstated, there are still 250,000 to recover.
Prior to the pandemic, Quebec had nearly full employment, but now the unemployment rate is close to 9.5 per cent.
If the virus wreaks havoc in the coming months, it will cause even more damage to the public purse.
“We will have to take extraordinary measures, depending on the situation,'' said Boulet, recalling that, for the government, ”financial capacities are much more limited than they were last spring.”
The first wave of COVID-19 has eaten away some $6.6 billion from Quebec coffers.
In June, Quebec Minister of Finance Eric Girard estimated the province’s annual deficit was around $14.9 billion. He also announced that he was setting aside $4 billion to offset the impact of a possible second wave of the virus.
Minister Boulet said the government would be there to help people who have lost their jobs.
This report was first published by The Canadian Press on Aug. 13, 2020.