Qualitative Research on the State of the Economy and COVID-19

Perceptions of the Government of Canada’s Management of the Pandemic

Each focus group opened with a short discussion on what, if anything, participants saw as something that the Government of Canada had been getting right over the last year in managing the COVID-19 pandemic and similarly, what, if anything, they had been getting wrong. Providing various forms of financial support to Canadians, especially through the Canadian Emergency Response Benefit (CERB), was often raised as something the federal government got right. Many participants also indicated that the communications coming from the Government of Canada were timely, informative and useful.

In terms of what the federal government got wrong, many felt that the Government should have “closed the borders” sooner than it did and many also felt that any sort of travel in and out of the country should have been more limited. Some were also concerned that there were Canadians and businesses alike who “took advantage” of benefits when in fact they did not need them.

Financial Impact of the COVID-19 Pandemic

The impact of the pandemic on the lives of participants cannot be overstated. The social, financial and emotional impacts are widespread, varied and in some cases quite severe. Although some have recovered in some way, many are just getting by, and many continue to struggle. A more focused discussion on personal finances revealed that many participants have been negatively affected by the pandemic. More often than not, the impact was job related (e.g. getting laid off, reduced hours, etc.) with the bulk of the disruption occurring soon after the pandemic began and into the summer months of 2020. While some have found new employment, many remain in dire financial straits and have not been able to find new work. Other forms of financial duress include increases in the cost of living, insufficient rental support, and high personal tax rates.

Assessment of Federal Support Programs

Awareness of the various forms of financial support provided by the federal government was high, especially for CERB. Most of those who did incur some sort of financial duress because of the pandemic emphasized that they would not have been able to make ends meet had it not been for government support programs, especially CERB. Those who never did make any use of these programs were also quite supportive of them, many explaining how they knew someone who had used one of these programs.

Most participants also believed that the immediate, decisive and sustained nature of this support was one of the more notable ways in which the Government of Canada set itself apart from governments in other parts of the world when it came to supporting its citizens during the pandemic.

As noted earlier, some participants were concerned with the way the support programs had been rolled out and generally managed. Concerns tended to focus on the screening process to make sure that those who received the funding genuinely needed it. Despite these concerns, participants agreed that when the pandemic started, swift action was needed and the benefit of having the government quickly deliver support seemed to outweigh any concerns participants had with misuse. Furthermore, none of the participants seemed to believe that anyone genuinely needing the support was denied that support because there was misuse by others.

Turning to the future, participants believed that the support programs should continue until the pandemic is over and that a gradual pull back was warranted over time rather than suddenly stopping support programs.

Among the general population there was also some awareness of the federal support provided to businesses, namely the wage subsidy. Those aware of these federal support programs agreed that these programs were warranted and made a difference. Awareness of these programs was high among business owners and operators although only a few had accessed one or more of the support programs. The programs were not used by some because they did not need the support while a few explained that the application process for the Canadian Emergency Business Account (CEBA) and for the wage subsidy seemed complicated and, furthermore, they were not certain they would even qualify. A few did not want to take on a loan.

Views on the Canadian Economy and Expectations Regarding the Recovery

Most participants would consider the current Canadian economy weak, performing poorly and fragile. These perceptions tended to be closely tied to how participants saw their local economy performing and how their own household was faring. Looking to the future, participants were more likely to be optimistic than pessimistic. For many, an economic recovery was largely dependent on Canadians returning to health and staying healthy.

For many participants, an economic recovery essentially meant “Canadians getting back to work”. They also considered the success of small businesses in their area as a barometer for the state of the economy.

In terms of the role of the Government of Canada, participants generally agreed that they do in fact have a role to play. For the most part, many participants would want the federal government to effectively manage the pandemic in such a way that will allow Canadians to get back to work and spend money. For some this meant limiting the spread of the virus, while for others it meant increasing domestic capacity for producing a vaccine. Participants also suggested that financial support programs for individual Canadians and small businesses hard-hit by the pandemic should continue.

There was moderate awareness and understanding of the term “stimulus spending” across participants. It was generally seen as: government is spending money to get the economy going. Once the moderator explained stimulus spending, mostly by referring to activities such as investing in infrastructure, tax cuts to individuals and businesses, and financial supports, participants seemed to grasp the idea quite well although they did not seem to have firm views on which specific measure was warranted for the current situation.

Participants were also fairly uncertain when asked at which point it would make sense for the federal government to pull back on stimulus spending. As noted earlier, some considered the economic recovery inextricably linked to the pandemic and as such, they felt that once the pandemic was under control, then the government could ease back on stimulus spending since consumer spending should be back to normal.

Participants were not aware of the federal government referring to “guardrails” to help guide its decision on when it will pull back on stimulus spending. Given a few examples of the indicators the federal government was monitoring, participants were mostly in agreement that they were watching the right kinds of indicators. That said, some did stress that these economic indicators do not take into consideration the quality of employment nor the mental health of the workforce.

Views on Deficits and the Federal Budget

Nearly all participants recognized that the government is in a deficit situation and that, because of the support provided to Canadians, this deficit had grown. Most seemed under the impression that the federal government had always been operating with a deficit, most were generally unaware of the size of the deficit and very few were concerned with it.

While participants were not in favour of deficits and growing the Canadian debt, they did however appreciate the unique situation the country is facing and that the current deficit is required in this exceptional time. Once the virus is under control, then the discussion can shift to winding support programs down and balancing the budget.

In terms of the upcoming federal budget, participants were fairly general in their priorities and what they would want to see come out of this budget. Most of the suggestions harkened back to the issues that had been raised throughout the discussion, with a focus on themes such as healthcare and supporting Canadians hit hardest by the pandemic. There was also interest in having the federal government take a closer look at investing in daycares spaces and having some sort of plan to eventually return to a balanced budget.

Perceived Role of the Federal Government

In terms of the role of the Government of Canada, participants generally agree that they do in fact have a role to play. They were much less specific however in terms of the exact measures or actions they would see the federal government taking to spur on the economy. For the most part, many participants would want the federal government to effectively manage the pandemic in such a way that will allow Canadians to get back to work and spend money. Controlling the pandemic was seen as an unavoidable precursor to any economic recovery and that is where the federal government could play a significant role. In this context, it was suggested in almost every focus group that Canada should develop its own vaccine manufacturing capacity and that this is also an area in which the federal government could potentially invest. This would not only address current supply issues but would also ensure vaccine autonomy and self-sufficiency in the future.

Otherwise, participants suggested that financial support programs for individual Canadians still unemployed or hard-hit by the pandemic should continue, and that small businesses continue to be supported if not further supported compared to now. Investment in training and skills development was also suggested, though participants were not very prescriptive in terms of how this should happen. A few suggested that companies could be subsidized to train new or current employees. But in the end, participants were eager to have programs support individuals displaced by the pandemic, which could include investing in skills in the “green” economy, especially for individuals who are working in the oil industry, and helping individuals who had been working in industries hit inordinately hard by the pandemic such as travel, tourism, restaurants, aerospace, etc.

• There were some mentions of investing in infrastructure but few were specific in this regards. Some did suggest investing in hospitals, long-term care facilities and in healthcare in general. For these participants, the pandemic revealed some important gaps in these areas and they believe that additional investment was warranted.

• Businesses felt they needed support for skills development and training since they will not be able to attract employees that they laid off because of the pandemic. By hiring entirely new employees, they will need to spend time and money training these individuals and the federal government could help them address these additional costs.

There were no immediate or spontaneous concerns that the unique nature of the upcoming economic recovery might leave some Canadians behind. Only after prompting from the moderator did some feel that this might be the case. A few participants felt that the pandemic created a greater divide between the “haves” and “have nots” and that any economic recovery would not only further highlight that gap, but also widen it. Some also felt that the pandemic did hit specific industries harder than others, such as travel, tourism, retail, restaurants, etc., and that these would not be able to recover as quickly, if at all, compared to other sectors. Generally though, many participants simply assumed that any economic recovery will always leave some people behind and that this one would be no different in that respect.

Some felt that small businesses in general would struggle more to emerge from the current economic slump compared to medium and large companies. Participants were quick to highlight that larger companies, especially larger retailers and online companies, were better equipped financially to go through the pandemic. Some also explained that larger companies have multiple locations across the country, if not the world, and that this makes it easier for them to absorb shocks in specific regions. Finally, there is a sense that some of the larger companies were able to remain open and in fact thrive during the pandemic whereas many smaller businesses were forced to reduce their hours or shut down completely because of lockdown requirements. This perceived inequity in the business world compelled many to encourage the federal government to further support small businesses now and as the economy recovers.

It should be noted that participant empathy for the plight of small businesses in their community was not limited to their economic contribution. The research revealed an emotional or sentimental element to small businesses - they are considered an important part of the fabric of any thriving community.

Stimulus Spending

There was moderate awareness and understanding of the term “stimulus spending” across participants. However, those who had heard the expression before were not necessarily comfortable explaining it in their own words. Many could roughly make out what is involved when a government does “stimulus spending” in the context of an economic recovery – they basically explained it as: government is spending money to get the economy going. For the most part, participants saw the objective of stimulus spending as putting Canadians to work, increasing their disposable income which in turn allows them to spend this money on food, consumer goods, etc., and injects money into the economy. For the most part, when participants imagined stimulus spending, they saw it as the government spending money – they did not consider that stimulus spending could involve other measures such as tax cuts and financial supports. Once the moderator explained stimulus spending, mostly by referring to activities such as investing in infrastructure, tax cuts to individuals and businesses and financial supports, participants seemed to grasp the idea quite well. Even given these examples, participants did not seem entirely comfortable or confident in terms of recommending or preferring one form of stimulus spending over another. Some high level reactions to some of the measures suggested include the following:

• Some liked the idea of financial supports and tax cuts for individuals, sensing that the additional disposable income would go a long way for them. They also believe that support for individuals struggling through the pandemic was still warranted.

• As noted earlier, some felt small businesses need all the support they can get and that tax cuts and supports for them would benefit the economy.

Participants were hard-pressed to suggest how the federal government could invest in such a way that the Canadian economy emerge from the pandemic better than it was before. Participants were not entirely focused on innovative investment or how Canada could emerge more competitive than before, although that notion does resonate. They are more concerned with staying healthy and getting through what continues to be seen as an ongoing crisis with no clear end in sight. Of the few suggestions that did emerge from this conversation, participants tended to broadly recommend that the government invest in research and development, that the Canadian economy move away from primary industries and invest more in manufacturing and value-add industries and that Canada remain alert to and invest in emerging technologies. Participants also suggested investing in education in general, but also in skills development more specifically.

Guardrails

Participants were also fairly uncertain when asked at which point it would make sense for the federal government to pull back on stimulus spending. As noted earlier, some considered the economic recovery inextricably linked to the pandemic and as such, they felt that once the pandemic was under control, then the government could ease back on stimulus spending since consumer spending should be back to normal. Some also felt that stimulus spending could be reduced once everyone is back to work, when businesses will be allowed to open and operate normally and when unemployment in general is down to where it was pre-pandemic.

Participants were not aware of the federal government referring to “guardrails” to help guide its decision on when it will pull back on stimulus spending. Contrary to “stimulus spending” for which some participants were able to imagine what it could involve, few could formulate an explanation for “guardrails” in an economic context and the moderator was required to provide an explanation and examples of some of the metrics that the federal government was watching (e.g. the employment rate, the unemployment rate, and total hours worked). Armed with this information, participants were mostly in agreement that the federal government was watching the right kinds of indicators to help guide its decision on stimulus spending, especially since jobs market indicators, in particular unemployment, were often mentioned by participants throughout the discussion as ways for them to gauge the state of the economy.

That said, some did stress that conventional economic indicators, including those currently considered by the federal government as guardrails, do not take into consideration the quality of employment nor the mental health of the workforce. For example, someone might be working more hours, but this may contribute to stress or exhaustion. As well, labour market issues like underemployment (i.e. someone working in their field but in a position lower than that for which they were trained) or inadequate employment (i.e. someone not at all working in the field for which they were trained, such as an engineer working as a grocery store clerk) are not covered by conventional indicators. To many, the pandemic has revealed and contributed to mental health duress and participants often emphasized the importance of further supporting Canadians in this respect moving forward, which includes factoring quality of life into indicators of economic success. Terms such as a “happiness index” surfaced in a few sessions in reference to this concern.

Specifications

• Recruit 8 participants per group, for 6 to 8 to show.

• Participants to be paid $100.

General Population Groups:

• 5 online focus groups with Canadians 18+ (which includes vulnerable Canadians) in the following five locations:

  • British Columbia/Yukon/Northwest Territories (English);

  • Alberta/Saskatchewan/Manitoba/Nunavut (English);

  • Ontario (English);

  • Quebec (French), and,

  • Nova Scotia/Newfoundland/Prince Edward Island/New Brunswick (English).

• Mix of participants reflective of Canada’s diversity, based on age, education, socio-economic status, urban and rural populations, gender, and ethnicity

Vulnerable Canadians:

• 5 online focus groups with Canadians in the following five locations and categories:

SEGMENT DEFINITIONS:

• Business owners - a mix of micro-sized (1-4) and small businesses (5-99).

• Non-standard workers (Gig/Contract/Freelance/On-Demand Workers): defined as individuals who work for remuneration characterized by uncertainty, usually not employed on a long-term basis by a single-firm or individuals (task requesters), workers complete a specific task or agree to work for a specific period of time for which they are paid a negotiated sum and limited social benefits and statutory entitlements

• Young people: 18-34 years of age, with a focus on students and recent graduates

• Newcomers/visible minorities/Indigenous: A newcomer is defined as someone who has been living in Canada for less than 5 years. In the context of this research, Indigenous and ethnic communities’ participants are defined as a participant who self-identifies as such at the following question:

  Do you identify as any of the following?

  • An Indigenous person (First Nations, Inuit or Métis)

  • A member of an ethnocultural or a visible minority group other than an Indigenous person

• People with disabilities and seniors: Someone with a disability is defined as someone who answers “yes” to the following question (as used in other Government of Canada public opinion research):

  Do you identify as a person with a disability? A person with a disability is a person who has a long-term or recurring impairment such as vision, hearing, mobility, flexibility, dexterity, pain, learning, developmental, memory or mental health-related impairments which limits their daily activities inside or outside the home such as at school, work, or in the community in general.

• Women out of the workforce: defined as a female who could work but cannot find work or has stopped looking for work for one reason or another.

ALL TIMES ARE LOCAL TIMES UNLESS OTHERWISE INDICATED

ALL SESSIONS ARE ENGLISH UNLESS OTHERWISE INDICATED

Questionnaire

1. Introduction to Procedures (8 minutes)

Thank you all for joining this online focus group!

• Introduce moderator/firm and welcome participants to the focus group.

  • Thanks for attending/value you being here.

  • My name is [INSERT MODERATOR NAME] and I work with Quorus Consulting, and we are conducting research on behalf of the Government of Canada.

  • Today we will be talking about the various challenges and opportunities that Canada faces these days and over the coming months.

  • The discussion will last approximately 90 minutes.

  • If you have a cell phone or other electronic device, please turn it off.

• Describe focus group.

  • A discussion group is a “round table” discussion. We will also be asking you to answer survey questions from time to time to help guide the discussion.

  • My job is to facilitate the discussion, keeping us on topic and on time.

  • Your job is to offer your opinions on the concepts I’ll be showing you tonight/today. Your honest opinion is valued.

  • There are no right or wrong answers. This is not a knowledge test.

  • Everyone’s opinion is important and should be respected.

  • We want you to speak up even if you feel your opinion might be different from others. Your opinion may reflect that of other Canadians.

  • To participate in this session, please make sure your webcam and your microphone are on and that you can hear me clearly. If you are not speaking, I would encourage you to mute your line to keep background noise to a minimum…just remember to remove yourself from mute when you want to speak!

  • IF NEEDED: I will be sharing my screen to show you some things.

  • We will be making regular use of the chat function. To access that feature, please scroll over the bottom of your screen until the command bar appears. There you will see a function called “chat”. It will open a chat screen on the far right of your screen. I’d like to ask you to use chat throughout our discussion tonight. Let’s do a quick test right now - please open the chat window and send the group a short message (e.g. Hello everyone). If you have an answer to a question and I don’t get to ask you specifically, please type your response in there. We will be reviewing all chat comments at the completion of this project.

  • I also want to say that if you feel you didn’t have a chance to express your opinion on anything during the session, you can feel free to comment in writing in the “chat”. For the most part chat with “everyone” unless you feel you need to send me a private message.

• Explanations.

  • Please note that anything you say during these groups will be held in the strictest confidence. We do not attribute comments to specific people. Our report summarizes the findings from the groups but does not mention anyone by name. Please do not provide any identifiable information about yourself.

  • The report can be accessed through the Library of Parliament or Archives Canada.

  • Your responses will in no way affect your dealings with the Government of Canada.

  • The session is being audio-video recorded for report writing purposes / verify feedback. The recordings remain in our possession and will not be released to anyone, even to the Government of Canada, without your written consent.

  • Some of my colleagues involved in this project are watching this session and this is only so they can hear the comments first-hand.

• Please note that I am not an employee of the Government of Canada and may not be able to answer questions about what we will be discussing. If questions do come up over the course of the group, we will try to get answers for you before we wrap up the session.

  Any questions?

2. Warm-up – General context (7 minutes)

Let’s get started with a broad question. As you know, we have three levels of government in Canada – federal, provincial and municipal. I want to focus specifically on the federal government.

Could you each tell me you think is the number one thing you think the federal government has been getting right over the last year in managing the COVID-19 pandemic?

Now could you tell me what’s the number one thing you think the federal government has been getting wrong in the last year in managing the COVID-19 pandemic?

3. Impact of the Pandemic on Them Personally (30 minutes)

Note to moderator: For business group, have participants focus on impacts on business.

I’d like to bring the discussion back to you and, in particular, how the pandemic has affected you personally. Now I appreciate that because of how widespread the impacts have been, this topic can lend itself to lengthy and detailed stories, however, to allow each of you time to speak on this topic, I’d ask you to summarize your situation in a few sentences.

So, in a few sentences, how do you feel the pandemic has had an impact on you personally? MODERATOR EXPLORES WITH MOST PARTICIPANTS AS MUCH AS POSSIBLE

How would you describe your personal situation these days? AFTER FIRST PARTICIPANT RESPONDS, MODERATO WILL RE-DIRECT PARTICPANTS TO FOCUS ON FINANCIAL IMPACTS TO NARROW THE DISCUSSION

Some of you may have already touched on this topic, but can you help me understand how, if at all, the pandemic has had an impact on you financially.

• How, if at all, has the pandemic impacted your employment or hours of employment? Were there certain months when you were most impacted?

• How is your employment and income security these days?

• And what are the next few months looking like on this front? Are you expecting things to change over the next few months? If so, what kind of change are we talking about?

  • How are you feeling about your job security over the next few months?

What would you say are the biggest financial concerns for you or your family right now?

• How do you plan on addressing these concerns?

• If things continue as they are today, what do you expect to be concerned about in a few months time?

Throughout the pandemic, we have all needed to rely on different people and different forms of support to get to where we are today. And chances are we will still need support moving forward.

• Help me understand what has helped you get through some of the challenges you’ve faced throughout the pandemic?

[As some of you have mentioned / Some of you may recall], throughout the pandemic the Government of Canada introduced various financial supports for individuals and businesses.

• Can anyone describe some of the government programs that were introduced to support individuals specifically (we will discuss business supports in a moment)? Please remember that I’d like you to focus on the programs that were introduced by the Government of Canada specifically.

• What are your thoughts on those programs? As far as you know, did these make a difference to Canadians? IF NEEDED: How can you tell they made a difference to Canadians?

• Did these programs make any difference on your personal situation? And if so, in what ways?

• [QUICKLY] Based on the state of the pandemic and what the next few months are looking like, what do you think should happen to programs for individuals?

  • Do they need to keep going? If so, for how long?

  • Do they need to change in any way? If so, in what ways?

  • Does anything new need to be introduced to support individual Canadians?

Let’s turn our attention to businesses.

• Can anyone describe some of the Government of Canada programs that were introduced to support businesses? [MODERATOR TO QUICKLY EXPLORE WITH GENERAL POPULATION]

SECTION RESERVED FOR BUSINESS OWNERS

• What are your thoughts on those programs? As far as you know, did these make a difference? IF NEEDED: How can you tell they made a difference to Canadians?

• Did these business support programs make any difference to your personal situation? And if so, in what ways? Help me understand that.

  PROBE AS NEEDED:

  • Has government support protected your job security during the pandemic?

  • [BUSINESS OWNERS] Has your business been kept afloat?

  • Have local businesses that you rely on benefitted?

• [QUICKLY] Based on the state of the pandemic and what the next few months are looking like, what do you think should happen with those programs?

  • Do they need to keep going? If so, for how long?

  • Do they need to change in any way? If so, in what ways?

  • Does anything new need to be introduced?

• How do you think the Government of Canada has performed in supporting Canadians through the pandemic in comparison to other countries? Why do you say that?

4. State of Canada’s Economy and Expectations Regarding the Recovery (30 minutes)

Let’s spend the time discussing the economy overall.

• What one word would you use to describe how the Canadian economy is doing these days?

• How do you think the economy will be doing in the coming year? Do you think things will get better or worse? Why? Why not?

• Which measures would you use to determine if Canada’s economy is recovering from the effects of the COVID-19 pandemic? …what would be a telltale sign for you that the economy is turning the corner?

• Again, I appreciate that nobody really knows what the economic recovery will look like. As the economy recovers, do you have any particular concerns with what that might look like?

  • Do you think some Canadians will benefit from changes in the economy as a result of COVID-19? Who are these groups? Why? Do you have any concerns that some Canadians may be left behind?

• What role do you feel the Government of Canada has to play when it comes to the economic recovery?

  • What are the most important ways the Government of Canada can help ensure an inclusive recovery that leaves no Canadian behind?

• These days, the Government is doing what is called “stimulus spending” to address the current health and economic crisis.

  • We often hear this expression (stimulus spending) – in your own words, what does this mean? What do you think the Government is trying to achieve through stimulus spending? …how does it work?

  • If, broadly speaking, the goal is to bring the economy back to health, what should the Government consider doing?

    EXPLORE AS NEEDED:

    Should it be investing in infrastructure?

    Should it provide income supports?

    Should it make personal tax cuts? ... corporate tax cuts?

• Some have argued that the economic recovery coming out of the pandemic is an opportunity for the Canadian economy to come back better than before. If the Government wants to invest in the Canadian economy so that when it recovers, our economy is more competitive and innovative, are there areas or types of investments you believe would help achieve this goal?

• At what point, in your opinion, would it make sense for the Government to pull back on stimulus spending?

  • Do you have a timeframe in mind? Is there a point in the recovery that you would consider the turning point when the Government should start moving away from stimulus spending?

  • The Government has been referring to “guardrails” to help guide its decision on when it will pull back on stimulus spending and return to its usual approach to fiscal management. Have any of you heard about these guardrails, and if so, what do you think of this approach?

    Just so we are all on the same page, the Government is using metrics related to the jobs market to guide its decisions regarding when to pull back on stimulus spending, such as the employment rate, the unemployment rate and total hours worked.

    • Now that you have a bit more information on this approach, do you think these metrics are the right ones to be looking at?

    • Which one makes the most sense to you?

5. The Budget (15 minutes)

Now, I want to shift focus a bit to the Government of Canada’s financial situation.

• How do you feel about the fact that Canada has been running deficits? Is it something that is a major concern for you personally or is not that big of a deal?

  • IF CONCERNED: Why does the deficit concern you?

  • IF NOT CONCERNED: Why doesn’t it concern you?

• Do you think the government should try to balance the budget as quickly as possible in the next year or two, or is this not such a big priority right now? Why/why not?

• If we consider the cost of borrowing for the Government of Canada, how affordable is it for the Government to be borrowing these days?

  • Are any of you aware of that aspect of how our Government manages its finances?

  • …and do you think that this is an important consideration?

The Federal Government has a budget coming up. Just so we are all on the same page, this is when the Federal Government announces specific plans, initiatives and priorities and how much funding will be allotted to those specific activities.

• What are your top priorities for Budget 2021?

  • Help me understand why that is a priority for you?

IF NEEDED:

• In terms of programs and initiatives, are there areas you feel the Government of Canada has overlooked recently?

When we can safely re-open the economy and COVID-19 is under control, what is one idea you have for how the federal government can help you or your community?

6. Wrap-up (2 minutes)

Does anyone have any additional thoughts on what you have seen and heard tonight / today?

Thanks again! The team that invited you to participate in this session will contact you regarding the manner in which you can receive the incentive we promised you.

ON BEHALF OF THE GOVERNMENT OF CANADA, THANK YOU FOR YOUR PARTICIPATION