Skip to main content

Prime Minister Justin Trudeau speaks during a sitting of the Special Committee on the COVID-19 Pandemic, in the House of Commons, in Ottawa, on July 22, 2020.Adrian Wyld/The Canadian Press

Prime Minister Justin Trudeau says the government plans to move out-of-work Canadians into the employment-insurance system and provide parallel support for millions set to exhaust emergency pandemic aid who don’t have EI to fall back on.

The $80-billion Canada Emergency Response Benefit is set to wind down over the coming weeks, with those who are EI-eligible to start drawing assistance that way.

Speaking this morning, Mr. Trudeau said many people who don’t qualify for the program, such as gig or contract workers, will gain access to a transitional, parallel benefit that is similar to EI.

It will also include access to training, and the ability to work more hours without having as steep a clawback in benefit payments, Mr. Trudeau said.

He said more details will be unveiled at a later date.

The most recent figures on the CERB show that as of July 26, the government had paid out $62.75-billion in benefits to 8.46 million unique applicants since its launch.

About half those costs have gone to EI-eligible workers, leaving millions who don’t pay into EI unable to access the program once the emergency benefit ends.

“No one will be left behind,” Mr. Trudeau said.

The economy started to reawaken after severe lockdowns in March and April, as Statistics Canada reported the gross domestic product grew by 4.5 per cent in May.

The average economist estimate was for a 3.5-per-cent increase in GDP for May, according to financial data firm Refinitiv.

The national data agency said rebounds in May were seen across multiple industries with the easing of COVID-19 restrictions. Retail trade registered a 16.4-per-cent bump to mark its largest monthly increase since comparable readings began in 1961.

Motor vehicle and car sales contributed the most to retail growth. Statistics Canada says the sector would have grown by 11.4 per cent had they been excluded from calculations.

In a preliminary estimate for June, the agency said the economy continued to pick up steam, with a five-per-cent increase for the month.

Despite the two months of growth after two months of negative readings, Statistics Canada’s preliminary estimate is that economic output contracted by 12 per cent in the second quarter compared to the first three months of 2020.

The June and second-quarter figures will be finalized late next month.

CIBC senior economist Royce Mendes said in a note that a 12-per-cent drop in the second quarter would be the largest decline ever by a long shot, even if such a decline is expected.

The Bank of Canada’s most recent economic outlook expected the second quarter of 2020 to be worse than the first, estimating a three-month drop in GDP of 14.6 per cent.

Over all, the central bank expected an economic contraction of 7.8 per cent this year, warning that after an immediate turnaround as restrictions eased, a recovery would be long and bumpy with some businesses and jobs not surviving the downturn.

Statistics Canada says economic activity still remained 15 per cent below prepandemic levels despite the gains over May as business activity was slowly allowed to resume.

Canada's chief medical officer Dr. Theresa Tam says active discussions are taking place to potentially pre-order COVID-19 vaccine doses for Canadians.

The Canadian Press

Sign up for the Coronavirus Update newsletter to read the day’s essential coronavirus news, features and explainers written by Globe reporters and editors.

This content appears as provided to The Globe by the originating wire service. It has not been edited by Globe staff.

Report an error