by David Korzinski | December 27, 2021 4:45 am
December 27, 2021 – It’s the holiday season and Canadians are being told to limit their social contacts as the COVID-19 virus sweeps across the country. Many wait for their turn to get an immunization that will help protect them and hopefully bring the end of the pandemic one step closer.
Those sentences could be used to describe both December 2020 AND December 2021. While much of the world feels like it’s in a COVID-19-induced holding pattern, key issues continue to shape and shift Canadians and their country. From your team at the non-profit Angus Reid Institute, here are five issues to watch in 2022. COVID-19 and its various variants will continue to be intertwined into all other issues affecting Canadians. It’s the umbrella casting shade over all other stories and is therefore not mentioned as its own item to watch. We’ve all been watching it for a long, long time.
The Angus Reid Institute (ARI) was founded in October 2014 by pollster and sociologist, Dr. Angus Reid. ARI is a national, not-for-profit, non-partisan public opinion research foundation established to advance education by commissioning, conducting and disseminating to the public accessible and impartial statistical data, research and policy analysis on economics, political science, philanthropy, public administration, domestic and international affairs and other socio-economic issues of importance to Canada and its world.
How do governments respond to the threat of climate change after a year of unprecedented weather disasters across the country and around the world?
A record-breaking heatwave in the Pacific Northwest claimed the lives of hundreds of people and led to mass casualty events among marine animals. Wildfires ravaged much of the world, including in British Columbia where the town of Lytton was devastated by the eponymously named wildfire. Parts of the globe also experienced record breaking precipitation, which inundated metro systems in China, caused extensive flooding across Germany and Belgium, and led to what may be Canada’s most expensive climate disaster in British Columbia.
Climate change has consistently been a top issue across the country this year. Despite the implosion of the federal Green party, concerns over the environment and climate change played an important role in the country’s national election in 2021. Observers noted that this was the first election in which all (elected) parties brought serious climate plans to the table, with climate modelling experts vetting both the incumbent Liberals and the CPC proposals.
Shortly after winning another minority government that looked much the same as the last, Prime Minister Justin Trudeau announced a climate action plan at the COP26 summit in Glasgow. The plan includes commitments to phase out thermal coal by no later than 2030, help developing countries transition to green energy alternatives through a contribution of up to $1 billion, and capping and reducing pollution from the oil and gas sector to net zero by 2050.
Prior to the election, Trudeau’s government committed Canada to achieving net zero emissions by 2050, which will require a significant effort to green the country’s energy production and consumption. How – and at what cost – remains to be seen. Stay tuned in the new year for polling on that subject.
Canada’s – and Trudeau’s – record on environmental policy is spotty at best. A November environment commissioner’s report detailed three decades during which the government failed to translate talk into action, notably highlighting that Canada has the worst record among the G7 countries for reducing emissions of greenhouse gases since 2015. A majority of Canadians want more from Trudeau; 52 per cent said in November his governments have not done enough to address climate change while three-in-ten (30%) said he’s done too much.
Will Canada be able to remediate its reputation on climate change in 2022 – a year already predicted to be one of the hottest on record? At COP26, Trudeau trumpeted the success of his carbon pricing plan, but carbon taxes will add to another factor Canadians will have to grapple with in 2022. Inflation is currently at a level not seen in two decades and will likely force policy makers to make tough fiscal decisions on all portfolios including environment in the year ahead. The Conservatives have already called for a freeze on the federal carbon tax as Canadians struggle with the rising cost of living.
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The Bank of Canada’s policy is to keep inflation steady at between one and three per cent as measured by increases to the consumer price index, which tracks the broad cost of living in Canada. For eight straight months, the CPI has risen above that rate. In October and November, inflation was 4.7 per cent, the highest it had been since February 2003. Canadians have struggled with the rising costs. In October, four-in-five said their income had not kept pace with the rising cost of groceries. Next year, it’s expected to get worse: the Canada Food Price Report estimated the average family of four’s grocery bill will increase by $1,000 in 2022.
A rise in the cost of groceries, gasoline and other staple goods has coincided with a continued climb of housing prices. Some Canadians were able to turn pandemic savings into down payments, accelerating a rise in home prices that have now increased 375 per cent nationwide in the last two decades. And the trend is expected to continue in 2022. High housing prices have divided Canadians into three groups: the haves (40%), who want the boom to continue lifting their assets, the have-nots (39%), who hope for the market to tank so they can get in, and the status quo (21%) who don’t mind prices staying right where they are:
Combined, the home buying boom and inflation leave financial policy makers in a tough spot. The Bank of Canada has indicated that it plans to consider raising lending rates halfway through next year, but it faces increasing pressure from Canadians outpaced by the rising cost of living to act sooner. However, any rise in rates threatens the financial situation of Canadians sitting on debt and loans – especially mortgages. Indeed, in October, more than half (53%) of Canadians believed an interest rate hike of two percentage points would have a negative impact on their household finances, including one-in-five (22%) who believed it would be significantly damaging.
Economists expect the Bank of Canada to act in the new year, but whether the bank raises interest rates sooner rather than later could be determined by the December tea leaves: the latest data on jobs, another look at inflation and the impact of a COVID-19 spike driven by Omicron.
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A pandemic-provoked labour market shift finds companies needing to accommodate a work force that became accustomed to the flexibility of working from home.
In March 2020, companies moved formerly deskbound employees out of the office and into their homes as a temporary measure to limit social interactions and prevent the spread of COVID-19. The short-term health protocol provoked a sea change, shifting the labour market as many employees took their laptops home and have yet to return.
Indeed, as of August 2021, one-fifth of Canadian workers now work from home according to Statistics Canada, a decline from the April 2020 high of two-fifths, but a significant jump from the 3.6 per cent of workers who said so in 2016. Notably, in August, COVID-19 was slowly rebounding from a summer nadir, but had yet to reach the peak of the fourth wave.
While part of the shift to working from home is a function of businesses recognizing that workers can be as productive, or more, at home than in the office, it also is a company concession to employee preferences. In August, ARI found 44 per cent of those who currently worked at home and preferred to continue doing so said they would quit immediately or start looking for a new job if they were called back into the office.
Employees are in a seller’s market for their labour, as employment rebounded to pre-pandemic levels in the fall. That means companies are likely in a position to fold to employee demands, like remote work. Statistics Canada estimated in October that 40 per cent of Canadian jobs can be done from home, which means the future of employment could be closer to April 2020 than August 2021.
The tight labour market also means employees can demand higher wages, but that factors into another story heading into 2022 outlined above: inflation. Economists worry that wage growth is more likely to further add fuel to the inflation fire than it is to increase Canada’s economic productivity. So, while Canadians may find themselves with higher wages, it may not be enough to outpace a climbing cost of living.
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Internationally, Canada’s relationship with China is under an increasingly bright spotlight leading into the February Winter Olympics in Beijing – assuming rising COVID-19 cases don’t spoil the party.
The Sino-Canadian relationship has seen more downs than ups over the last year. Trade with China increased during the pandemic, but diplomatic relations have been turbulent. Following the arrest of Huawei executive Meng Wanzhou in 2018 by Canadian authorities at the behest of the United States, Beijing arrested two Canadians – Michael Kovrig and Michael Spavor – in response and tried them for espionage. This led to a precipitous decline in public perceptions of China which only reversed – slightly – following the Michaels’ release.
More recently, relations have been rocked by Canada’s decision to follow in the footsteps of the U.S., U.K., and Australia and implement a diplomatic boycott of the upcoming Olympic Games in Beijing – a move a majority of Canadians supported, but Chinese officials dismissed as a farce. While most Canadian athletes will compete at Beijing noticeably absent will be NHL players who, as was recently announced by the league, will not be attending due to the surge in COVID-19 cases.
How the Sino-Canadian relationship evolves in 2022 remains to be seen. Canada still needs to decide whether or not to ban Canadian companies from buying Huawei equipment to construct 5G networks, a move China’s ambassador said would send “a very wrong signal.” Though Canadians want Canada to prioritize human rights over business concerns in its relationship with China, data slated to be released in early January suggests that Canadians worry the economic costs of taking a stand against China may be too great.
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Canada’s two most populous provinces, comprising 60 per cent of the country’s population, are scheduled to hold elections in 2022 and the two premiers running for re-election find themselves on opposite ends of the popularity spectrum.
In Quebec, Premier and Coalition Avenir Quebec leader Francois Legault has been consistently one of the country’s most popular premiers since he was elected in 2018. While it has waned in recent months, Legault still enjoys majority approval from Quebecers.
His government has received high grades for their handling of the COVID-19 pandemic, though it remains to be seen how voters react to the most recent lockdown the province entered in response to the record-level of cases driven by the Omicron variant. In contrast, Quebecers felt in October that Legault’s government has done a poor job handling seniors care (63%). The crisis of the early days of the COVID-19 pandemic, when more than 4,000 seniors died from infection in Quebec long-term care homes, is still fresh in Quebecers’ minds. Opposition parties have called for a public inquiry into the deaths, which has so far gone unheeded by Legault.
Notably, three-in-five say the CAQ government has mismanaged health care (60%) and half say the same of education (50%), two key provincial jurisdictions.
In Ontario, premier Doug Ford has not enjoyed the same amount of popularity as Legault. It looked like he had turned the approval ship around during the early portion of the pandemic before returning to the lows of 2019.
Ontarians have given the government a poor assessment in its handling of key issues: as of October, seven-in-ten (67%) believed the PC Party of Ontario government had done a poor job on health care and three-in-five disagreed with the work they’ve done on the economy (57%) and education (62%). Four-in-five were also disappointed with the government’s work on housing affordability (83%) and seniors care (79%).
In October, Ontarians offered the highest praise for Ford’s government’s work on COVID-19 (45%) and transportation infrastructure (42%). The latter figures to be a key issue in the upcoming election, as the PCPO have already begun running election ads saying they’ll be the party to build highways to get Ontarians out of gridlock, such as the controversial Highway 413.
Ford will face two challengers on his left: the NDP led by Andrea Horwath, who were in a statistical tie with Ford’s PCPO in ARI’s most recent polling, and the Liberal party led by Steven Del Duca. Both have already been the target of negative ads, setting the tone for what could be a close fought campaign.
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