(Reuters) – Canadian automation company Promation had opted for a weaker currency to help it win a new US contract, but a slower pace of vaccinations in Canada could erase that competitive advantage, the president said Darryl Spector.
Pandemic travel restrictions make it difficult for Promation technicians to travel across the border to repair and repair plant equipment, an inconvenience when competing with an increasingly vaccinated U.S. workforce.
“With a fully vaccinated supply base in the United States, why buy in Canada if you can’t access the labor to support it?” Spector said.
To prevent the spread of coronavirus, the U.S.-Canada border has been closed for nearly a year by the footsteps of all workers except the essentials and by a handful of other exceptions. In Canada, manufacturers fear that slower deployment of vaccination may delay the reduction of these restrictions.
U.S. President Joe Biden told states Thursday that all adults could be eligible for the coronavirus vaccine before May 1st. Canadian Prime Minister Justin Trudeau has set himself the September goal of vaccinating all Canadian adults.
In the United States, some manufacturing workers already receive inoculations, such as at car plants in the Detroit area. By contrast, workers in general manufacturing, such as those at the Ontario-based firm in Spector, are not yet eligible in Canada.
The lag is said to affect Canadian businesses and could threaten Canada’s economic recovery in the coming months.
Although the recovery has picked up pace, the Bank of Canada warned on Wednesday that the virus would continue to pose a risk to the economy until the population is widely vaccinated.
U.S. health authorities have issued guidelines that exempt asymptomatic vaccinated workers from the strict protocols of COVID-19 in case of exposure, but Canada has not yet considered similar actions.
This leaves Canadian companies at increased risk of losing working hours or stopping for COVID-19 testing and tracking contacts if an employee tests positive.
“People can’t work so hard together if they look over their shoulder in case someone has COVID,” said Spector, who recently sent eight workers home and covered the costs of the test results when the woman an employee tested positive.
Matt Poirier, director of trade policy for Canadian manufacturers and exporters, said his association has called on provincial governments to prioritize vaccination of factory workers to curb the impact of outbreaks on plants.
As of March 10, Canada had administered 7.20 doses of COVID-19 vaccine per 100 people, compared to 29.67 in the United States, according to data from Oxford University.
Its dependence on imports has hampered Canada’s vaccination campaign, but deliveries are expected to increase in the second quarter.
INVESTMENTS SUFFER
Uncertainty is holding back Canadian companies’ investment, with capital intentions for 2021 still 12% below pre-pandemic levels, according to Statistics Canada.
In comparison, capital spending for S&P 500 companies is expected to increase by 11.8% in 2021 after falling by 13.7% in 2020, according to IBES Refinitiv data.
“Businesses … could choose to place their capital at a faster return on investment,” said Trevin Stratton, chief economist at the Canadian Chamber of Commerce. “The vaccination schedule certainly affects that.”
In Quebec and Ontario, the provinces most affected by COVID-19 and where much of the Canadian manufacturing sector is located, lost working days jumped 13.9% and 12.0%, respectively, in 2020. that there are hoped that higher vaccination rates could help reverse this trend.
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Reports by Allison Lampert in Montreal and Julie Gordon in Ottawa; additional reports by Caroline Valetkevitch in New York; Edited by Denny Thomas and Cynthia Osterman