Businesses big and small slam the brakes on back-to-the-office plans amid rapid Omicron spread

Some of the biggest employers in Canada are pausing plans to slowly bring some workers back into the office because of Omicron — and that's having devastating consequences on the businesses that rely on them.

Major financial conglomerates, including the big banks and insurers, were all in the process of slowly returning some staff to offices in a limited capacity. But they've hit the brakes on those plans given the rapid spread of the latest COVID-19 variant.

Manulife was planning to restart office work on Jan. 24, but told employees in a memo this week that it is shelving those plans. Rival Sun Life told CBC News that it is "encouraging the people who were volunteering to come into the office to stay home until the end of January."

Collectively, those major financial firms employ tens of thousands of people in downtown Toronto, an area that the president and CEO of the city's board of trade calls the largest employment zone in the country, with more than a half a million people within a few city blocks, under normal circumstances.

"We have 2,500 small businesses in the downtown that rely on those daytime employees to be their customer base," said Jan de Silva, calling the situation "critical."

It's a similar story in other cities. Like many businesses, Montreal-based recruitment firm Ranstad Canada moved its staffing model toward working from home when the pandemic started. The system worked, but the company was starting to pivot back to in-person work on a limited basis, but that's all out the window now, president Patrick Poulin says.

"We've been opening the branches allowing some of the employees to have access to those branches," he said in an interview, "but now shutting them down."

Back-to-the-office plans are on hold while the highly transmissible Omicron variant is spreading. And the same is true of any other type of in-person meetings between staff. 

"We know that there is a lot of Christmas dinners and lunches happening between the teams and ... we've asked the teams to postpone those get-togethers," he said.

After nearly two years of a pandemic, that's distressing news for any workers who hoped to be able to loosen up a little this holiday season. But it's devastating news to businesses that earn a living from servicing them.

Small businesses that cater to larger employers in downtown cores couldn't really pivot to working from home when the pandemic hit, so many closed down until it passed.

As Canada's vaccination campaign gathered steam in 2021, it brought a slow and steady trickle of foot traffic back to them.

But now that trickle is slowing again. Andre Vassighi owns the clothing store Vassi Menswear in Toronto's PATH system, a subterranean pedestrian mall connecting major buildings downtown that brings in functionally all of his customer base.

He says 2020 was the worst year for his business in the 25 years since he's run it, but by November 2021, sales were back to about half of what they were before the pandemic. Now, he is seeing a slowdown again, and knows the worst may be yet to come.