The year 2021 was filled with so many challenges for businesses. It began as a “catch up” year, due to the 2020 Covid-19 pandemic continuing into 2021. Businesses postponed investments, and many were only able to remain in business through government loans. COVID-19’s impact extended to the international market, creating broad uncertainty and slowing Canada’s export-focused economy. Businesses across industries that survived 2020 have now spent 2021 trying to recover from lockdowns that kept people at home and led to shifting buying patterns. As 2022 approaches, it is a time for reflection and determination as to how to convert both the 2020 challenges and the emergent 2021 business transitions into a new year of opportunities to strengthen business sustainability.
The pandemic has triggered so many changes in the Canadian and global business arenas. It changed consumer, employee and business behaviors all at the same time. Consumers are now buying online more than ever before. Remote work has become a common practice. Businesses reorganized their supply chains in response to supply chain disruptions.
In 2022, the big question is how many of these behavior changes are permanent. Will the growth in online sales continue? Will Covid variants continue to suppress exports? How many businesses will retain a hybrid workforce?
Out of challenges come numerous opportunities. For example, the supply chain disruptions led to the development of a “buy local” mindset, which is a great opportunity for Canadian businesses, and especially the small-and-medium enterprises. (SMEs) An RBC survey found opportunities for small businesses in the consumer buying shift to online retail platforms. Four out of five Canadians say they will continue online shopping post-pandemic, while they are becoming more socially and locally conscious at the same time. Many shoppers are actively seeking and supporting diverse-owned companies, and it is millennials (65 percent) and Gen Z (71 percent) driving the change.
A major challenge for 2022 is closing the skills gaps, as companies find it difficult to fill open positions. Express Employment Professionals commissioned a survey in September 2021 and found that 84 percent of companies will have trouble finding qualified people. The reasons given by the hiring decision-makers is that applicants lacked relevant hard skills (46%); there is a lack of applicants (35%) and applicants lacked soft skills (33%). Labor difficulties signal opportunities for businesses in staffing, skills training and development of technology that can perform more work and close some of the labor skills gaps.**
The Canadian health services industry is rapidly adopting new technologies. The Canadian population is aging, creating a new set of opportunities for businesses going forward. People over 65 years old make up approximately 17% of the population, but account for nearly half of healthcare spending. The healthcare industry is challenged in many ways, but offers incredible business opportunities for innovations that help older people live healthier lives or reduce healthcare costs.
Covid-19 has left many small businesses in poor financial condition. They have added debt, are experiencing a labor shortage, and continue to have difficulties obtaining goods and materials. Supply chain disruptions continue to impact all sizes of businesses. Costs are rising, and a lack of inventory to sell is hurting revenues. SMEs must compete with larger businesses, which is difficult. Also relevant to business growth is the fact that SMEs can only take advantage of the greater market access that technology offers by investing in those technologies and the people who manage them. Spending more money upfront and for future maintenance costs is not appealing, when faced with the additional debt assumed during the pandemic. The financial services industry can partner with businesses to help them manage their debt through business growth.
As new COVID variants appear, Canada must decide how it will sustain and eventually grow its economy once again. RBC makes it clear that collaboration between all the players in the business arena is crucial – businesses, government, industry associations and educational institutions must work together to adapt to the new reality. The real opportunities for businesses in 2022 are finding innovative ways to do business and to support other businesses, and that could mean developing new technologies, accessing new markets, developing talent and providing support services. The 2-year pandemic impacted the present, but it has also permanently changed the future. It is a new reality.