Fewer Manitobans accessing federal emergency funds By: Temur Durrani Posted: 7:00 PM CDT Tuesday, Jul. 28, 2020

Hey there, time traveller!
This article was published 28/07/2020 (1918 days ago), so information in it may no longer be current.

Manitobans accessing federal emergency funds in July fell by two thirds from the peak of the pandemic lockdown thanks to tighter criteria, the province’s quick recovery and the “good old Manitoba economy.”

That’s according to experts who spoke to the Free Press, analyzing comprehensive wage subsidy data from Ottawa released Tuesday.

Numbers from the $24-billion sector-to-sector and province-by-province federal breakdown shows 107,520 people in Manitoba received $228,152,000 between March 15 and April 11 — averaging just over $2,100 per worker.

Fund distribution in Manitoba dropped by eight points in early May, doubling decline in June and reaching a total of 40,650 people receiving around $1,965 through the program in July.

But while similar trajectories were seen in Nova Scotia and Saskatchewan, Ontario and Quebec’s numbers rose with each period.

Out of the nearly $24 billion federal wage subsidy funds allocated to date, Ontario and Quebec have received about 40 and 20 per cent of all reserves, respectively, from March through July.

“It definitely comes down to how each province is recovering from COVID-19 cases,” says Parisa Mahboubi, senior analyst at the C.D. Howe Institute in Toronto researching demographics and labour markets.

“Manitoba has been reopening its economy at a much faster rate than most provinces with people going back to work without many mandatory shutdowns,” she said. “More activity means more earning, but it also means less federal funds.”

Industry-level analysis shows “Professional, Scientific & Technical Services” took the top chunk (around 12 per cent) of all subsidy funds. Food service, health care and construction sectors were just a few points behind (at around 10 per cent, each).

Meantime, education, culture, finance, entertainment and arts industries received the lowest rung of total funding (just between one and two per cent, each).

Overall, however, each sector’s demands for federal funds nearly halved by early July.

“Manitoba has been reopening its economy at a much faster rate than most provinces with people going back to work without many mandatory shutdowns. More activity means more earning, but it also means less federal funds.” – Parisa Mahboubi

Gregory Mason, economics professor at the University of Manitoba, says that might have to do “less with need and more with targeting.”

“It’s extremely hard to target this kind of support to begin with,” he said. “But as we continued to recover from the pandemic, criteria for this sort of support became more developed.”

Mason pointed to the composition- and size-level breakdown of data released by government, which showed over 70 per cent of all businesses supported by the wage subsidy comprised 25 or less employees.

Medium-sized companies of 26 to 250 people received less than a quarter of program funding, while larger companies with over 250 workers took up just over one per cent.

“I think what we also have to understand that the only option for quite some time was the CERB program,” said Mahboubi.

“CERB means more individual applicants with a much more generous criteria,” she said. “That’s not necessarily the case with the wage subsidy.”

Mason agreed, but said “we can never really definitively pin down why these numbers look the way they do.”

“For all we know, people might also be afraid of the government clawing back this funding when tax season comes around.”

It remains unclear how many Manitoba applications for funding were denied. Data released Tuesday only showed numbers from “approved” applications.

temur.durrani@freepress.mb.ca