Politics

Emergency COVID-19 wage subsidy program extended to end of August

The government's emergency wage subsidy program will be extended to the end of August to help employers keep their workers on the payroll during the pandemic, says Prime Minister Justin Trudeau.

Extension comes as a growing number of businesses prepare to open across the country

A 'closed' sign hangs in a store window in Ottawa on April 16. Some retail stores are slowly reopening in parts of the country as COVID-19-related restrictions are lifted. (Adrian Wyld/The Canadian Press)

The government's emergency wage-subsidy program will be extended to the end of August to help employers keep their workers on the payroll during the pandemic, Prime Minister Justin Trudeau said today.

The program — which covers 75 per cent of an eligible company's payroll, up to a maximum of $847 per week per employee — originally was set to expire next month.

"You have some runway to catch your breath as you get restarted," Trudeau said in his prepared remarks. "So please, bring back your workers."

Companies that saw their revenues drop by 15 per cent in March or 30 per cent in April and May are eligible for the program — but Trudeau hinted changes could be coming to that threshold.

"As businesses start up again, this shouldn't become a barrier to growth," he said.

WATCH: Trudeau's outlook on businesses rehiring during the pandemic

Prime Minister Justin Trudeau says he hopes the extension of the wage subsidy program to the end of August will give businesses a level of certainty while they look to reopen during the pandemic. 1:46

During a separate briefing, Finance Minister Bill Morneau said the program will now be available to registered journalism organizations, registered amateur athletic associations, Indigenous government-owned corporations and non-public colleges and schools, including arts, driving, language and flight schools.

The government will consult businesses and labour representatives over the next month about other possible adjustments to the program to promote jobs and growth, said Morneau.

Trudeau and other members of his cabinet have been promoting the wage subsidy as a way to keep Canadians employed instead of leaving them to draw on the $2,000 per month Canada Emergency Response Benefit.

As of Monday, more than 123,000 businesses have been approved for the emergency benefit, to cover close to 1.7 million workers' wages. As of May 14, meanwhile, the government has received more than 13 million applications from nearly eight million Canadians for the CERB.

"As the economy reopens, there is a danger of unintended consequences," said Trudeau.

"So we're going to work with industry, work with labour, work with stakeholder groups to make sure we're getting it right, but that wage subsidy is going to be a really important part of the coming months of recovery."

The original program was pegged to cost $73 billion, although just $3.36 billion in subsidies has been paid out so far.

Morneau said it's not clear how much the expanded program will cost.

Businesses slowly reopen

The extension comes as some businesses prepare to gradually reopen.

Ontario announced details of its first stage of reopening yesterday. Beginning on Tuesday, retail stores outside of shopping malls that have street entrances will be allowed to open.

In Alberta, retail stores, hair salons, museums, daycares and day camps are allowed to open, with restrictions, across much of the province. Calgary and Brooks, however, are on a different timeline due to higher case counts of COVID-19 in the two areas.

The country lost almost two million jobs during the month of April — a record high — as the impact of COVID-19 on the economy made itself known, according to Statistics Canada figures released a week ago.

The agency's Labour Force Survey data estimates the total number of jobs lost during the crisis at more than three million.

Corrections

  • A previous version of this story said more than 13 million Canadians have applied for the CERB. In fact, the government says it's received more than 13 million applications from nearly 8 million Canadians.
    May 15, 2020 2:03 PM ET

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