Statistics Canada recently released a new report: Forging ahead during the pandemic: How selected service industries bounced back in 2021. The report is largely based on an analysis of GST revenue data which helped identify business trends. Taking a deep dive into the impact of COVID-19 on the Canadian economy, the report details the results of some of the changes including remote work and new ways of reaching customers and producing services. With the well-documented struggles that persist today like supply chain disruptions, labour shortages, skill gaps and inflationary pressures, the study shows how some industries have fared throughout the pandemic.
As anticipated, tourism (accommodation services) experienced the strongest revenue growth in 2021 but interestingly, it remained one of those furthest from a full recovery. In contrast, the digital sector has performed with relative stability throughout the pandemic. As businesses move full-speed ahead towards digital transformation, services like software publishing, data processing, hosting and related services maintained solid revenue growth in 2021 and based on our estimates in the advertising industry which is tied closely to these services, we expect this stability to continue in 2022/23.
According to our members, the biggest challenge we face continues to be the talent shortage. In fact, the report concludes that “despite the strong bounce back and several positive developments, businesses operating in the service sector are still contending with risks associated with supply chain disruptions, inflationary price and wage pressures, external geopolitical factors, labour constraints, and the easing of government pandemic support programs. Technological and digital advances are playing a role in alleviating some of these challenges, but price and labour pressures are priorities for many businesses operating in the service sector.”
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