Showing posts with label economics. Show all posts
Showing posts with label economics. Show all posts

Sunday, January 22, 2023

Covid Vaccines saved Canada Billions in Damages

 A story that did not get much press in December is here in part and in full here

December 15, 2022 – Vaccination campaigns against COVID-19 saved Canada billions in averted health and economic costs, according to a new report from the C.D. Howe Institute.

In “Damage Averted: Estimating the Effects of COVID-19 Vaccines on Hospitalizations, Mortality and Costs in Canada,” authors Rosalie Wyonch and Tingting Zhang provide estimates of  COVID-19 cases, hospitalizations and deaths prevented by vaccination as well as the economic costs that could have occurred without vaccines.

“Overall, our analysis shows vaccines were highly effective at reducing COVID-19 cases, hospitalizations and deaths – estimates suggest 21 percent fewer cases, 37 percent fewer hospitalizations and 34,900 fewer deaths (from January 2021 to May 2022),” say Wyonch and Zhang.  “The direct cost of vaccine administration compared to the savings associated with averting missed work and treatment costs due to illness indicates an estimated net cost/benefit of –$0.4 billion to $2.1 billion. Using the statistical value of life, the estimated lives saved are valued at an additional $27.6 billion.”  

Thursday, February 11, 2021

Job displacement in the time of COVID

The world just recovered from the great recession of 2008-2010 and when Donald Trump was elected, and he moved America to a more isolationist position, which brought uncertainty to the world. In 2020 COVID-19 hit and the world was faced with economic uncertainty. For those thinking about retirement, this is one more blow to the idea of retirement.

In 2013 the OECD wrote a report on how to help workers that were displaced  in 14 countries because of the recession to get back to work. These workers were displaced because of involuntary job loss due to economic factors such as economic downturns or structural change and the lessons learned may be of interest as we move out of 2020 into 2021.

The following is from the executive summary. Some workers have a greater risk of job displacement and are more likely to experience poor post-displacement outcomes than others. In most of the countries examined, older workers and those with low education levels have a higher displacement risk, take longer to get back into work and suffer greater (and more persistent) earnings losses. While youth also have a higher risk of displacement than prime-aged workers, they fare better afterwards. Young workers generally find work relatively quickly after displacement, often in jobs with greater skill requirements than their previous jobs. Women are generally no more likely to be displaced than men, once other factors such as the type of contract they hold before displacement are considered. However, women are more likely than men to become disconnected from the labour market and experience longer spells of inactivity after displacement.

The extent of earnings losses after displacement varies substantially across countries. Earnings losses tend to be low in the Nordic countries, but much larger in the other countries examined in the report. Most of the loss in annual earnings after displacement can be attributed to time spent out of work rather than to lower wage rates upon re-employment.

In most of the countries examined, men suffered from bigger and more persistent earnings losses than women, despite women taking longer, on average, to return to work. Older workers and those who did not complete secondary school also tend to suffer greater-than-average earnings losses after displacement.

As well as lower earnings, re-employed displaced workers are more likely to work in part-time or non-permanent jobs than prior to displacement, and work shorter hours on average. Other measures of the quality of post-displacement jobs, such as the incidence of work at non-standard times, the availability of paid leave and whether workers have managerial responsibilities, also suggest a decline in job quality after displacement. Some of this effect may be due to the loss of seniority that displacement brings, as job quality tends to improve with longer tenure.

Displaced workers tend to use fewer mathematics, cognitive, interpersonal, and verbal skills and more craft and physical skills in their pre-displacement jobs than the average employee. This suggests that they may be ill-equipped to take advantage of job opportunities in expanding sectors after displacement. 

Nevertheless, most displaced workers who are re-employed find jobs that use similar skills to their pre-displacement jobs, even if they move to a new occupation or industry. Even among those who experience a significant change in skill use following displacement, many move to jobs with higher skill requirements than their former jobs. However, a small sub-set of workers experience “professional downgrading”, where their new jobs use far fewer skills than their previous jobs. Those who suffer professional downgrading experience significant losses in math, verbal, cognitive and interpersonal skills, modest gains in the use of craft skills and significant increases in the use of physical skills.

Changes in skill use after displacement explain some, but not all, of the earnings losses experienced by displaced workers.

Changes in an industry also appear to matter, suggesting that the loss of job-specific skills plays a role alongside changes in the use of generic skills.

These findings help identify several policies issues to be explored in future work. 

First, are policies that require large firms to provide re-employment services to displaced workers justified? On the one hand, this report shows that workers in smaller firms have a much higher risk of displacement than those in larger firm, suggesting that general active labour market programs are needed. On the other hand, while displacement is more likely in smaller firms, the number of displaced workers is generally larger in larger firms, possibly justifying existing obligations applying to the latter.  

Second, what type of re-employment assistance and training is best suited to help displaced workers find work? findings in this report suggest that not all displaced workers may need retraining to find a new, high-quality job as not all changes in industry or occupation after displacement lead to a significant change in the skills used at work. However, a small group of displaced workers moves to a job with significantly lower skill requirements, leading to professional downgrading and more sizeable earnings losses, pointing to the need both for skills assessment at unemployment entry and either retraining or job-search support to improve the match between skills and job requirements. 

Third, should helping people return to work quickly, especially for women, older workers and the low skilled, be a priority to limit earnings losses and skill depreciation after displacement? The finding, in this report, that earnings losses are almost entirely due to periods of non-employment rather than lower wages appears to support this view, except perhaps for the minority of workers requiring retraining. 

Finally, does knowing in advance about displacement make a difference in outcomes relative to not knowing? This issue is not explored in this report but should be the object of future analysis, notably by looking at countries – such as the United States, with its WARN Act (Worker Adjustment and Retraining Notification Act) – which require advance notification to workers affected by economic dismissals.

Saturday, November 3, 2012

Who Creates Jobs?

The following was posted on Northern Reflections: Who Creates Jobs: Yesterday, my son sent me a copy of this TED lecture. It features Nick Hanauer, an American venture capitalist, and is less than six minutes long.

It certainly is an interesting perspective and one that I believe to be true

Friday, September 14, 2012

Thoughts on the collapse of our economy

As we move forward in 2012, and the economic situation becomes worse, or better (depending on your frame of mind and what you are currently reading). I am reading more articles about the upcoming collapse of the United States economy. In these futuristic visions, the end of the world can be prevented by preparation.

The author of a blog called the economic collapse wrote an article called “20 Things You Will Need To Survive When The Economy Collapses And The Next Great Depression Begins”, In it he says "I listed 20 of the things that you would need in the event of a major disaster, a national emergency or a total economic collapse.  These are things that you are going to want to make sure that you have ready right now, because after the crisis begins it may be too late to prepare….
#1) Storable Food
#2) Clean Water
#3) Shelter
#4) Warm Clothing
#5) An Axe
#6) Lighters Or Matches
#7) Hiking Boots Or Comfortable Shoes
#8) A Flashlight And/Or Lantern
#9) A Radio
#10) Communication Equipment
#11) A Swiss Army Knife
#12) Personal Hygiene Items
#13) A First Aid Kit And Other Medical Supplies
#14) Extra Gasoline (But Be Very Careful How You Store It)
#15) A Sewing Kit
#16) Self-Defense Equipment
#17) A Compass
#18) A Hiking Backpack
#19) A Community
#20) A Backup Plan
In the comments to that article, the readers suggested the following additional items….
A K-Bar Fighting Knife
Salt
Extra Batteries
Medicine
A Camp Stove
Propane
Pet Food
Heirloom Seeds
Tools
An LED Headlamp
Candles
Clorox
Calcium Hypochlorite
Zip lock Bags
Maps Of Your Area
Binoculars
Sleeping Bags
Rifle For Hunting
Extra Socks
Gloves
Gold And Silver Coins For Bartering
Once again, a lot of these things are not going to be needed right away.  The economy is going to go through a lot more ups and downs before it totally dies."

Now in contrast to the above, I do not believe that the end of the world is not here nor is likely to be here soon. However, as we struggle with our own economic situations, we have to be aware of the good things life brings. If we will lose perspective on what is important, as I believe the people who share the above perspective have we will have lost some meaning for living.

Watch the joy in a toddlers face as they see something new, hear the sound of laughter as they see their friends or parents in the morning. Listen to the sounds of an August shower, birds singing, and the music of life that surrounds us everyday. An old song from my generation was called, You have to stop and smell the roses, (which I shared on December 15, 2010) I still think the words and the sentiment of the song are important

"There's a whole lot more to life than work and worry
The sweetest things in life are free
And there right before your eyes
You got to Stop and Smell the roses
You've got to count your many blessings everyday
You're gonna find your way to heaven is a rough and rocky road
If you don't Stop and Smell the roses along the way"


Life is exciting, wonderful and as an older friend of mine keeps telling me "it is better than the alternative"

Wednesday, August 24, 2011

Firms have record $800 billion of cash but still won't hire

 A couple of great posts that face the issues and tell the truth about trickle down economics and how BC politics is in a Mess. The first is over at The Straight Goods, he speaks the truth without holding back and as a result, makes us think. This post certainly did this for me.  The second is an article that I saw through Accidental Deliberations another progressive blogger who posts some interesting ideas and does not hold back his punches. The article he references the title. Here an excerpt from his post

Tom Mills challenges the Cons to show any job creation whatsoever as a result of their non-stop corporate tax slashing:
The thing is, if corporate tax cuts really do create jobs, Flaherty should be able to demonstrate it by now with something a little more substantial than theories.
Canada's corporate tax rate has dropped incrementally from 22.1% in 2005-06 to 16.5% today. The government should be able to track what jobs this has created.
Show us the jobs, I'd say. And show us full-time industrial jobs, not part-time service ones. Private sector, not civil service.

Otherwise, maybe we should give trickle-up economics a try.

Sunday, June 5, 2011

Some thoughts on Financial Literacy and Boomers

I am currently reading the task force report on Financial Literacy that was published in Feb 2011. I find the report interesting but I am sure that many of my generation may not want to read it so over the next few weeks I will be highlighting aspects of the report and how I think it affects us.
I was struck by the fact that we are much better off then we think, according to the report:

"Canada’s retirement income system is designed to ensure universal coverage and to protect the incomes of particularly vulnerable groups (for instance, individuals with interrupted labour force participation or those with low incomes) and performs well relative to those of its peers in this regard (Whitehouse, 2009). Characterizing the precise level of income adequacy in retirement is a complex empirical undertaking, but general indicators of retirement living standards show that, on average, Canada’s retirees are relatively secure (Mintz, 2009; Whitehouse, 2009; Baker and Milligan, 2009). Poverty rates among elderly Canadians are low relative to international standards. Over the period of 2000-2009, the rate of poverty among elderly Canadians was, at 4.4 per cent, approximately one-third of the OECD average and one-sixth of the comparable figure in the United States" Page 6 Retirement Preparedness and Individual Decision-Making Implications for Canada by Joanne Yoong, RAND Corporation,arch paper prepared f
I am sure that this is a surprise to most seniors but if  you are one of the 4.4% I don't think it is helpful to know you are not as worse of as our American neigbours.

 "Using Canada Revenue Agency data from 2006, Horner (2009) estimated that, for almost 70 per cent of Canadian households, savings in retirement plans would be sufficient to fully maintain consumption levels in retirement, while almost 80 per cent would be able to achieve a 90 per cent replacement rate." Page 7 Retirement Preparedness and Individual Decision-Making Implications for Canada by Joanne Yoong, RAND Corporation,


What I found interesting is that in spite of the "strong safet net many of us are still nervous about retirement funding and some of us may have to sell our homes to meet ends meet in retirement.  "... the proportion of retirement income from private sources is also among the highest in the OECD and is characterized by a relatively small but increasing share of defined-contribution plans (OECD, 2009). In the 2009 CFCS, over 80 per cent of labour force participants indicated that they expect to draw savings from RRSPs, while 26 per cent expected to do so from the sale of other financial holdings, and 16 per cent from other non-financial assets such as homes or other tangible assets (Schellenberg and Ostrovsky, 2010). The insolvency of several major defined-benefit plans, coupled with significant losses in the value of private pension funds overall, have intensified concerns with respect to moderate-income households about retirement savings adequacy; these concerns pre-date the financial crisis of 2008 (Mintz, 2009)". Page 8 Retirement Preparedness and Individual Decision-Making Implications for Canada by Joanne Yoong, RAND Corporation,

The question I have is how do we make the decisions about what we will sell or do to make ends meet in retirement.  Morris Altman has some ideas in his report for the committee called: Behavioural Economics Perspectives. In his report Altman shows the different approaches to Economic Decision making that Economists believe people use. These ideas are important because they are used to shape government policies for the left and right of center parties. I have highlighted ideas I will talk about in upcoming blogs

Conventional  economic theory
  •  Individuals make intelligent decisions, and they do not regret them. Their choices reveal informed and well-considered preferences
  • An ideal decision-making environment is assumed.
  • Education and training (referred to as human capital formation) are regarded  as important means of enhancing productivity. But no clear theoretical mechanism is specified linking improvements in the quantity and quality of education and improvements in decision making. Human capital formation provides important theoretical space for explaining errors or less than ideal decisions, a space well-taken by behavioural economics.
  • Financial decision-making is assumed to be best-practice unless distorted by government interventions in the market and in decision making
 
Behavioural economics: Kahneman-Tversky, Errors and Biases Approach
• Individuals tend to make irrational, error-prone decisions, which they  eventually regret.

• Errors and biases in decision making are wired into the brain architecture.

• It is possible for the decision-making environment to be less than ideal.

• Individuals often do not know what is in their own best interest.

The benchmark for rationality in decision making is based on conventional  economics and focuses upon calculating behaviour.

• Decision-making shortcuts are regarded as typically error-prone.

Individuals are easily fooled and deceived by how questions are framed and  often reverse their preferred decisions with inconsequential changes in how  questions or options are framed.

• Education can sometimes improve decision making.

Government intervention in decision making is often thought to be the best practice  route to take for ideal choices to be made.

Financial decision-making will be biased and error-prone without government  intervention in choice behaviour.

• Some success predicted for improvements in the decision-making  environment, less for the improvements to financial education.

Behavioural economics: Simon, Bounded Rationality, Rational Individuals
Approach)
      Individuals are assumed to make rational decisions as a result of how the brain  is wired and the decision-making environment.

      Conventional benchmarks for rational or intelligent decisions are often  rejected.

      Decision-making shortcuts are rational more often than not, even when they  contravene conventional economic benchmarks.

      Individuals are not easily fooled, but they can be misled.

      Individuals can make decision-making errors and these can lead to decisions  that are subject to regret.

      A major source of decision-making errors is a less than ideal institutional  environment.

      Education can have important effects on decision making.

      Government plays an important role by establishing an ideal institutional  environment and by providing the education required for ideal choices to be  executed.

      Government should not intervene in individual choices unless these choices  can be shown to cause harm to others.

      Financial decision-making can be improved by improving the decision-making  environment and through improvement to financial education.

      Government intervention in choice behaviour is not considered to be best practice  if individuals make decisions in an ideal decision-making environment  and with appropriate levels of financial education