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Dmitri Tkachenko

As Canadians get older, economy gets weaker - The Globe and Mail - 0 views

www.theglobeandmail.com/...article2039511

Aging Unemployment Slowing economy

shared by Dmitri Tkachenko on 30 May 11 - No Cached
  • Dmitri Tkachenko on 30 May 11
     
    "Statistics Canada projection shows a sharp decrease that will continue for at least the next 20 years. Employment growth since 1976 has averaged 1.6 per cent a year, while the population grew at a rate of 1.1 per cent. That extra half a percentage point added roughly 0.3-0.4 percentage points to the average growth rate of real per capita income above what it would have been otherwise. Not only is this source of growth about to disappear, demographic aging is going to start being a negative contributor to economic growth: fewer workers mean less output. One of the first places we'll see the effects of population aging is its effect on the government budget balance. Higher output per worker would help compensate for a reduction in the number of workers, so productivity will become an increasingly important policy priority. But in the short and medium term, there is no quick fix. "
Steven Iarusci

Consumer fatigue an ominous sign for economy - The Globe and Mail - 1 views

www.theglobeandmail.com/...article2039584

debt consumer ratio economy slow

shared by Steven Iarusci on 02 Jun 11 - No Cached
  • Consumers typically account for 60 per cent of the country’s gross domestic product, and rising living costs along with elevated debt levels suggest they won’t be much help this year
  • Gross domestic product expanded at an annualized 3.9 per cent in the first quarter, the fastest pace in a year, led by business investment and manufacturing, Statistics Canada said
  • that pace will be cut by almost half in the second quarter, while Finance Minister Jim Flaherty told reporters Monday he’s anticipating “more modest” growth in the rest of the year
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  • In the near term, households are under pressure as rising food and energy costs cut into their budgets
  • “I will never, never do that again. I want to have the money up front before I buy something, because I don’t want to get into that trouble again,” said Ms. Thornton
  • In the longer term, high debt levels could restrain spending for years
  • Kim Thornton, for example, is one fatigued consumer. The mother of four says her family ran up about $50,000 in debt in prior years on credit card spending
  • the household debt service ratio – debt payments to disposable income – jumped to a three-year high of 7.8 per cent from 7.2 per cent
  • Canadians are getting the message about whittling down debt, and that is translating into fewer purchases of discretionary goods
  • reduced hours and leaner wages – a legacy from the recession – mean many families have less money with which to service their debt, he added
Noah Schafer

Jobless rate, global uncertainty to test Tories' economic strategy - thestar.com - 0 views

www.thestar.com/...-test-tories-economic-strategy

Canada USA Corprate tax stimulus governmentspending

shared by Noah Schafer on 05 Jun 11 - No Cached
  • The new Conservative government’s business-friendly economic strategy will be tested by uncertain global conditions and a stubbornly high jobless rate in Canada. One of the first items on Prime Minister Stephen Harper’s agenda when Parliament re
  • The new Conservative government’s business-friendly economic strategy will be tested by uncertain global conditions and a stubbornly high jobless rate in Canada.
  • n February, Canada’s output sank by 0.2 per cent, the worst monthly performance since May 2009.
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  • One of the first items on Prime Minister Stephen Harper’s agenda when Parliament returns will be reintroduction of a $278 billion budget that includes a sprinkling of social and economic spending and a plan to slay the budget deficit in several years. And the government will continue with a $6 billion corporate income tax cut.
  • “The risks still lie outside the Canadian border, which as we’re well aware can have a spillover effect on Canada,” said Royal Bank chief economist Craig Wright.
  • “We’re seeing continued uncertainty and concerns still with respect to the Eurozone and where it’s headed,” he said. Uncertainty on economic growth is also being fanned by volatile energy markets and the questionable U.S. business rebound, Wright said.
  • Prospects for Canada are also complicated by expectations that spending by debt-burdened consumers could slow in 2011 and by the shut-off of the Conservatives’ two-year, $47 billion emergency stimulus program.
  • With government spending slowing, the Conservatives have staked a great deal on their view that the business community will pick up the slack and stimulate the economy with expansion-minded investments.
  • Besides phasing in corporate income tax cuts worth $14 billion by 2012, the Conservatives in recent years have provided a wide range of investment incentives for business, including easing taxes on small business and manufacturers. In all, tax cuts for business by the Conservatives total an estimated $60 billion by 2013.
  • both Flaherty and Bank of Canada Governor Mark Carney have pointedly talked about the urgent need for more spending on machinery and equipment by companies.
  • But many are not convinced, with some Canadians saying the government would be smarter to tie tax incentives directly to company investments to ensure that corporations don’t just pocket the extra profits.
  • Speaking of corporate tax cuts, Canadian Association of Social Workers spokesperson Fred Phelps said it would be one thing “if corporations turned around and invested those funds into the economy.” But he said that hasn’t been happening in recent years. “What really has driven us out of the recession,” he said, “is spending by households and government, not business.”
Joey Keum

Canadian HR Reporter - Article - February job growth weaker than expected - 1 views

www.hrreporter.com/articleview

jobs canadians market

shared by Joey Keum on 03 Jun 11 - No Cached
  • Net employment gains in the month were a modest 15,100, below market forecasts of a 21,000 increase, said a Statistics Canada report.
  • he report disappointed hopes that hiring momentum in the previous two months would persist. Net job gains were 69,200 in January and 30,400 in December.
  • Canada has recovered jobs lost during the recession faster than the United States but the February data bucked that trend.
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  • The labour market is not going to create any further inflationary pressure, either coming from wage (gains) or the general strength in the labor markets," said Sebastien Lavoie, assistant chief economist at Laurentian Bank Securities.
  • In further signs of slowing, Canada's labour report said the economy shed 24,000 full-time positions in February, partially offset by the addition of 39,000 part-time jobs. The number of self-employed workers rose, while the number working in the private sector edged lower.
  • The February jobless rate was unchanged at 7.8 per cent, versus the 7.7 per cent forecasts by analysts in a Reuters poll.
  • The average hourly wage of permanent employees — which is closely watched by the Bank of Canada for inflation pressures — rose 2.5 per cent from February 2010, up from 2.3 per cent year-on-year rate in both January and December.
  • "It probably lowers the probability of any near term tightening by the Bank of Canada and as a result (will) probably weigh on the Canadian dollar," said Paul Ferley, assistant chief economist at the Royal Bank of Canada.
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