By Dr. DIONNE POHLER (PhD), Acting Director and PhD Chair, Centre for Industrial Relations and Human Resources, University of Toronto. Her major current research projects include investigating the gender earnings gap, the effects of COVID-19 on businesses and the labour market, inclusivity in rural communities, and the implementation challenges of labour and social policies in Canada.
 @DionnePohler | Dionne Pohler | dionne.pohler@utoronto.ca 

How did the unprecedented negative economic effects of COVID-19 impact the 2020 Saskatchewan election results? It’s not the economy, Stupid.^[i]

An important question in the democratic politics literature is whether economic conditions have a major influence on voter behaviour. Is an incumbent government more likely to be re-elected if the economy is doing well or kicked out if the economy is struggling?

The question is interesting because of how little influence elected officials, particularly in small, commodity-dependent provinces such as Saskatchewan, have on the economy. I have always thought (perhaps naively so) that Saskatchewan voters understood that, absent egregious mismanagement of the economy, the incumbent political party should be neither rewarded for a boom, nor punished for a bust, and that other important issues drove their voting behaviour. Indeed, studies exploring economic perceptions and voter choices in the 2011 Saskatchewan election highlighted that while voters care about the economy, other factors such as party leadership evaluations were more important in determining vote choice.^{[ii] [iii]}

While we should never confidently predict anything based on limited data points, the 2020 Saskatchewan election outcome provides more support for the idea that the economy is not the primary driver of electoral outcomes in the province. On October 26, 2020, the Saskatchewan Party was re-elected for their fourth term, retaining a resounding majority in seats and popular vote, notwithstanding that the government is projecting to run deficits until at least 2024.^[iv]

Moreover, in 2020 the Saskatchewan economy will see one of the worst contractions in its history, thanks to COVID-19. The World Health Organization (WHO) classified COVID-19 a global health pandemic on March 11, 2020. The early impacts of the virus in China and Italy generated major concern among policymakers in Canada. To ‘flatten the curve,’ protect vulnerable populations, and avoid overwhelming health care systems, federal and provincial governments enacted extensive public health restrictions. Saskatchewan declared a State of Emergency on March 18, 2020, limiting gatherings and shutting down many non-essential businesses.

COVID-19 and the associated economic shutdowns led to a major shock to Saskatchewan’s GDP. According to projections, the combination of weak commodity prices and the pandemic could result in a decline in GDP for 2020 of 7.7 per cent in Saskatoon^[v] and 8.2 per cent provincewide.^[vi] While 2019 was also not a strong year (Saskatchewan experienced a decline in GDP of almost 1 per cent, the worst performance of all the provinces)^[vii], the 2020 contraction is almost unprecedented. For perspective, during the 2009 global recession, the city of Saskatoon only had a 2.1 per cent contraction in GDP,^[viii] and the province experienced a 5.3 per cent decline.^[ix]

Some reasons the economy had so little impact on the Saskatchewan election are obvious. For instance, no rational person can blame the Saskatchewan government for the COVID-19 pandemic. And while COVID-19’s negative economic effects could theoretically be linked to the Sask Party’s decision to shut down large swaths of the economy, voters realize that the Sask Party was following suit with the rest of the country and public health guidance, and that the NDP would have done the same. Voters probably also realize that even if Saskatchewan had kept businesses open, its economy would have still taken a hit, as the federal government closed the borders in March and other countries were also struggling to contain the virus.

Moreover, Saskatchewan’s closures were less widespread than most other provinces and were lifted more quickly, leading to a V-shaped recovery of its labour market. The province’s monthly unemployment rate hit a high of 12.5 per cent in May, almost fully recovering since to its pre-pandemic rate (the unemployment rate was 6.2 per cent in February and 6.8 per cent in September); Saskatchewan’s September 2020 unemployment rate was the lowest among the Canadian provinces.^[x] Focusing on who the voters could trust to lead an economic recovery was a key message in Sask Party campaign ads—these pre-election numbers might have convinced some voters that the Sask Party was indeed able to most effectively oversee the recovery. While legitimate concerns are being raised about how elected officials across the country handled the pandemic—including in Saskatchewan where the province had relatively low case numbers in the early days but was fighting rising case numbers in recent months leading up to the election—Saskatchewan’s COVID-19 death rate is still among the lowest in the country, at 2 per 100,000 population.^[xi]

Other reasons why the economy had so little impact on the Saskatchewan election might be less obvious. One is that the economic effects of COVID-19 were less personally salient for influential voting blocks. For instance, older voters did not feel the negative economic effects of the COVID-19 shutdown the same way that younger people did.^[xii] Older voters were also more susceptible to mortality from the virus and so were likely more supportive of the province’s public health restrictions and shutdown and were willing to bear (and could better weather) the short-term economic cost. The COVID-19 shutdowns also had a more negative economic impact on low-income workers than the middle class,^[xiii] as middle class workers and high-earners were much more likely to be able to perform their jobs from home.^[xiv]

And, while they may loathe admitting it, the Sask Party should thank the federal Liberal government for Saskatchewan voters not feeling the economic effects of the COVID-19 shutdown as much as they could have. The suite of federal support programs for individuals and businesses attenuated the negative economic effects of the massive job, hours, and business revenue losses on Saskatchewan voters and removed the potential fiscal burden on a province with rising debt levels and limited capacity to provide such widespread and generous income support for workers, households, and businesses.

It’s unclear how long the Saskatchewan economy will take to completely recover from the COVID-19 shock, or when the province will see another commodity boom. If the provincial recovery is sluggish, federal support dries up, and provincial debt skyrockets, the economy may be a more serious obstacle for the incumbent Saskatchewan Party in the next election. Then again, maybe it won’t. After all, it’s not always about the economy, Stupid. At least not in Saskatchewan.

References

[i] It’s “the economy, [S]tupid” was a phrase coined in 1992 by James Carville, a political strategist in Bill Clinton’s election campaign.

[ii] Clavelle, K. (2013). Economic perceptions, vote choice, and the 2011 Saskatchewan Election (Doctoral dissertation, University of Saskatchewan).

[iii] McGrane, D., White, S., Berdahl, L., & Atkinson, M. M. (2013). Leadership, partisan loyalty, and issue salience: the 2011 provincial election in Saskatchewan. Canadian Political Science Review, 7(1), 1-12.

[iv] Government of Saskatchewan. (2020a). 2021-21 Deficit lower, province to return to balance by 2024-25. Retrieved from https://www.saskatchewan.ca/government/news-and-media/2020/august/27/first-quarter-report on October 28, 2020.

[v] Conference Board of Canada. (2020). Major city insights (October 20). Retrieved from https://www.conferenceboard.ca/focus-areas/canadian-economics/major-city-insights on October 25, 2020.

[vi] White-Crummey, A. (2020). Saskatchewan’s economy was already shrinking before COVID (June 1). Regina Leader-Post. Retrieved from https://leaderpost.com/news/saskatchewan/saskatchewans-economy-was-already-shrinking-before-covid on October 28, 2020.

[vii] White-Crummey, A. (2020). Saskatchewan’s economy was already shrinking before COVID (June 1). Regina Leader-Post. Retrieved from https://leaderpost.com/news/saskatchewan/saskatchewans-economy-was-already-shrinking-before-covid on October 28, 2020.

[viii] Conference Board of Canada. (2020). Major city insights (October 20). Retrieved from https://www.conferenceboard.ca/focus-areas/canadian-economics/major-city-insights on October 25, 2020.

[ix] Government of Saskatchewan. (2020b). Saskatchewan’s dashboard: Gross domestic product. Retrieved from https://dashboard.saskatchewan.ca/business-economy on October 25, 2020.

[x] Government of Saskatchewan. (2020c). Saskatchewan’s dashboard: Unemployment rate. Retrieved from https://dashboard.saskatchewan.ca/business-economy on October 25, 2020.

[xi] Government of Canada. (2020a). Coronavirus disease 2019 (COVID-19): Epidemiology update. Retrieved from https://health-infobase.canada.ca/covid-19/epidemiological-summary-covid-19-cases.html on October 27, 2020.

[xii] Statistics Canada. (2020). COVID-19 and the labour market in May 2020. Retrieved from https://www150.statcan.gc.ca/n1/pub/11-627-m/11-627-m2020038-eng.htm on October 28, 2020.

[xiii] Koebel, K. & Pohler, D. (2020). Labor markets in crisis: The causal impact of Canada’s COVID-19 economic shutdown on hours worked for workers across the earnings distribution. Canadian Labour Economics Forum Working Paper Series. Retrieved from https://clef.uwaterloo.ca/wp-content/uploads/2020/05/CLEF-25_2020-Spring-Summer-Koebel-Pohler.pdf on October 28, 2020.

[xiv] Messacar, D., Morissette, R., & Deng, Z. (2020). Inequality in the feasibility of working from home during and after COVID-19. StatCan COVID-19: Data to Insights for a Better Canada. Retrieved from https://www150.statcan.gc.ca/n1/en/catalogue/45280001202000100029 on October 28, 2020.

 

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