The COVID-19 pandemic will create winners and losers

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When the pandemic subsides, priorities will change, creating winners and losers in both the private and public spheres. The losers could include schools and landlords, while incumbent politicians may emerge as winners. Canada’s reputation may emerge as a winner as well.

Provincial governments spend about twice as much on health care – about 40 per cent of their budgets – as on education, which gets about 20 per cent. When this is all over, that gap is likely to widen.

The shift was under way before the pandemic: Canada’s fertility rate is half a baby short of what we need to sustain our population. Immigration accounts for almost all of our population growth. In most provinces, school enrolment is declining.

In the meantime, Canada is aging, with the costs of long-term care expected to triple over the next three decades. Now there will be a new expense: preparing for future pandemics. This could mean stockpiling equipment and expanding acute-care capacity.

If spending on both long-term care and acute care increases, then the money has to come from somewhere. Expect to see larger class sizes and more online learning in the years ahead.

In the private sector, companies that rent out office space must be getting nervous. All around the world, corporations have embarked on a massive and unplanned experiment in shifting operations from office to home.

“Canadians have been slow to embrace the concept of remote working,” Colliers International observed in a report on the impact of the pandemic on commercial real estate. While half of all Canadians work from home occasionally, only one in five do frequently. For companies tied to a traditional office-based culture, “this period serves as a catalyst for workplace transformation,” the report stated.

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Although the productive value of collegiality – not to mention the need to get out of the house now and then – should not be underrated, many companies are doubtless discovering that productivity remains high when staff work remotely. Commuting times vanish. Virtual meetings are as efficient as real ones, and maybe shorter. And then there is the impact of the recession on corporate balance sheets.

Downsizing office space and encouraging work from home could be a lasting legacy of this pandemic.

If education and commercial real estate are at risk of taking a hit after it’s over, incumbent politicians are riding high. An Ekos poll released last week showed strong public support for Prime Minister Justin Trudeau and provincial premiers, with Quebec Premier François Legault 's popularity in the stratosphere. (The poll, conducted using interactive voice-response technology, surveyed 2,304 Canadians and has a margin of error of plus or minus 2 percentage points.)

Provided that Ottawa and the provincial capitals are able to meet their commitments – getting financial aid out the door, while bending the curve of COVID-19 infections over time through enforcing isolation – that rally-round-the-flag effect should last into the next federal election, provided that election is within a year or so.

Everything depends on execution. “The longer it takes for Canadians to receive the support they’re expecting from the federal government, the greater the political risks for Justin Trudeau,” pollster Nik Nanos told The Hill Times. If politicians fail to deliver, winners could quickly become losers.

But if they succeed, Canada as a whole may be seen as a winner, at least in comparison to the United States. At this stage, on a per-capita basis, fatalities from COVID-19 are four times higher in the United States than in Canada.

Part of the reason is that Canada was affected more severely than the United States by the 2003 SARS epidemic, which helped this country to prepare, according to Duncan Hunter, professor of Public Health Sciences at Queen’s University,

As well, “our response has been quite different” from the United States, Prof. Hunter said in an interview. Canadian governments, he said, have employed “an earlier and more co-ordinated response." For example, self-isolation protocols are more or less uniformly in place across the country, while the U.S. remains a patchwork.

The situation might well change. The worst is yet to come for both countries. And Canada’s measures do not compare favourably with some other jurisdictions, such as South Korea. But if current trends hold, it will be worth asking on both sides of the border what we got right that the Americans got wrong.

Other winners and losers are bound to emerge. This pandemic has upended all expectations. We may hardly recognize the world on the other side of this thing.

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