The COVID-19 pandemic has led to the largest global economic crisis since the Great Depression.
Economists agree an economic stimulus is the best first move to help businesses rebound as many continue to operate with safety precautions.
“Some of the (historical) lessons we’ve learned is that temporary spending seems to work pretty well and allows you to get your financial house back in order,” University of Regina’s Jason Child’s said.
A recent Scotiabank report found Saskatchewan’s economy is in a relative position of strength despite those precautions.
Last week’s report noted oil production was down 8.6 per cent, but there has been a 33 per cent increase in agricultural crop exports compared to this time last year.
Those exports combined with a bump in the potash and uranium sectors has helped ease some of the concerns.
In August, the province reported its deficit for this year went from $2.4 billion to $2.1 billion.
A Scotiabank senior economist believes one of the ultimate tests in order for the economy to flourish is how well the province handles the virus.
“How businesses respond to it, how households respond to it and ultimately to support growth for the longer run, this is the most important thing to get under control,” Marc Desormeaux said.
Before the campaign, the province committed to spending $7.5 billion in infrastructure over two years, which included a $2 billion stimulus package after pandemic measures kicked in.
The Saskatchewan Party has made several promises to help spur economic recovery including a temporary elimination of the business tax rate, and decreasing power bills by 10 per cent.
Leader Scott Moe also promised a balanced provincial budget by 2024.
The NDP’s Ryan Meili has not committed to a timeline to balance the budget.
The New Democrats have promised to help the economic recovery by introducing a $15 per hour minimum wage and a Saskatchewan first procurement policy to offer public contracts to workers living in the province.
Childs noted while striving for a balanced budget in that time span is a good goal to set, the province shouldn’t be committed to it noting circumstances can change fairly quickly.
He added simultaneously making sure the government’s cheque book is stable and the province’s economy is in a better position will be a task for whoever forms government.
The associate professor said one can suffer at the hands of the other, but both can’t afford to take sharp downward trends.
Childs went on to say the shotgun approach of providing funding to all sectors is a common one and will help temporarily but ensuring long-term growth is generally more stable when it comes from grassroots initiatives.
“If you’re trying to grow an economy, that’s a different story. And again that’s going to require a much defter touch than just trying to keep the lights on,” he said.
Childs said spending during an economic crisis makes sense, but the real direction for the budget and economy will be more clear once Saskatchewan is on the backside of the virus.
In August the province reported its debt could reach $33.6 billion by 2024-2025.