While Yukon businesses brace for lack of tourism, the pandemic's impact on mining is less clear

This story is part ofThe COVID Economy,a CBC News series looking at how the uncertainty of the coronavirus pandemic is affecting jobs, manufacturing and business in regions across Canada.

Tourism is everyone's business.

A sticker with that message, produced some years back,can still be seen on the odd bumper in Yukon, invariably covered with some degree of dirt and dust, part and parcel with driving here.

While the slogan is not unique to the territory, it's particularly meaningful during the COVID-19 pandemic,and not just to tourism operators although they, more than some others, are uncomfortably aware of its very real implications.

"The economic spinoff of tourism is not to be underestimated," said KalinPallett, president of the Wilderness Tourism Association of the Yukon, which represents about 70 adventure operators in the territory.

"Everything from from Air North [airline], to the hotels and the restaurants, the taxis, the gift shops, the tour operators themselves. The grocery stores the list goes on and on."

That ripple effect extends all the way to things such asquilting materials.

Ruth Headleyat Bear's Paw Quilts in Whitehorse saidtourists buying northern lights-themed fabrics and other souvenir designsmake up a good chunk of her summer revenue, when fewer local quilters are buying supplies.

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Tourism and mining are Yukon's two biggest privatesector industries,and while industry insiders say bothwill feel the impacts of the pandemic, the hit to Yukon's tourism industry is already very evident.

A 2017 business survey report by the Yukon Bureau of Statistics determined that 4.4 per cent of the territory's 2016 GDP,about $117 million, was attributable to tourism.

If the Tourism Industry Association of the Yukon is right about how much cruise ships contribute to that amount, thenroughly half of those dollars have already flown out the window for this year.

Last week, when Holland America said it wascancellingalmost all of its Alaska cruisesfor the summer, including all of its excursions into Yukon, Neil Hartling, the chair of the Tourism Industry Association of the Yukon, said that represents a $40 to $60 million loss to the territory'seconomy.

Hartlingsaid it's also foretelling of more hits coming to Yukon's tourism industry, especially as people look to cut spending amid the economic downturn.

"Tourism is a luxury and it's one of the first things that you can easily shed from your spending," he said. "And that's going to be happening around the world."

Yukon's summer tourism season, which starts in May, is typically the breadand butter ofmany tourism operators.

"They've gota 90-day window to make 365 days worth of money," said Pallett, president of Yukon'swilderness tourism association.

He said some operators have already decided to throw in the towel for the2020 season and try to find work elsewhere.Othersare turning their focus to shoulder season operations, inlate summer and fall.

Pallett said the unknown timeline of when COVID-19restrictions will liftaddsto the uncertainty.

"Unlike a retail store or a restaurant that can simply turn on the lights and open the doors and start generating revenue right away, tourism needs longer lead times."

These challenges come after what the Yukongovernment called a "banner" tourism year in 2018 (the year of the most recent tourism report), with records set for the number of visitors and total spending. According to its visitor exit survey, 62 per cent of visitors to the Yukon came from the U.S., about28 per cent were Canadian and the remaining 10 per cent came from countries other than the U.S.

Impact on mining unknown

TheYukon Chamber of Minessaysit's too early to know what impact COVID-19 will have on the mining industry, the territory'slargest private sector employer. In 2018, miningand oil and gas developmentmade up 5.7 per cent of Yukon's GDP.

"We could expect to see some slimming of that [mining revenue]," said Samson Hartland, executive director of thechamber. "Just how much is anybody's guess."

Yukon has two mines in operation. Victoria Gold, which poured the first gold bar from its Eagle Gold Mine near Mayo in September, said earlier this month it isproceeding with its operational ramp-up. It said it expectsgold production to increase "substantially" over the coming months.

Sara McPhee-Knowles, an instructor atYukon College's School of Business and Leadership who holds a PhD in public policy, said the economic downturncould have a positive impact on metal prices.

"In the last recession, in 2008 and 2009, the price of gold went up because investors view it as a safe bet," she said.

If that happens again, she said, it could benefit Yukon.

Victoria Gold continues operations despite a plea made last month by theNa-Cho Nyak Dun First Nation in Mayo, asking theYukon government to put a stop to mining and staking in the territory during the COVID-19 pandemic. The First Nation said thehundreds of workers rotating in and out of the nearby Eagle mine put the community at risk.

The company responded by saying it istaking appropriate precautionsand following the Yukon government's requirement that all workers entering the territory self-isolate for 14 days at a place other than a mine or camp. Some of those workers are staying at hotels in Whitehorse.

Hartland, with the Yukon Chamber of Mines, said keeping communities safe is a priority, but noted the 14-day quarantine requirement could be challenging for the "dozens and dozens" of smaller field and exploration programs that take place in the territory every summer.

He said work delays and added costs could be a deterrent for companies coming from out of the territory, especially if they were only planning to do a couple of weeks of work.

Hartland said one thing that wouldhelp the mining sector is a relaxation of regulatory requirements in the form of extensions on permitting and consultation deadlines.He said the limited capacity of some government offices because of the pandemic could otherwise delay processes and result in aslowdown of mining and exploration activities.

Governmentoffers up to $30,000 per month

When the Yukon government announced a business relief program earlier this month, Economic Development Minister Ranj Pillai, touted it as the"most comprehensive"business relief program in the country to date.

The program is forbusinesses that have seen areduction in revenue of at least 30 per cent during the pandemic. It will cover up to $30,000 per month for fixed costsincluding rent, water, sewage, electricity, internet, or insurance.

The program was announced after the Whitehorse Chamber of Commerce said only half of the businessesit surveyed thought they'd be able to recover from the economic impact of the pandemic.

At this time last year, Yukon boasted the highest employment rate in the country. Now, the situation in the territory is anything but rosy, though the number of jobs lost as a result of theCOVID-19 crisis won't be known for several weeks.

Because of Yukon's small population, employment numbers are calculatedbased on a three-month moving average, meaning numbers that reflect the full hit of the pandemic won't start coming out until June.