My personal theory as to why the Canadian banking system survived the great global financial crisis relatively unscathed is that calls by the big Canadian banks in the late 1990s to allow mergers were successfully resisted. Had the big banks been allowed to merge to pursue their global ambitions, they would have ramped up their US and high risk foreign […]
Read moreThis morning, Statistics Canada revealed the country’s worst-kept secret: the economy contracted for a second consecutive quarter in the first three months of 2009. Adjusted for inflation, Gross Domestic Product dropped by 1.4%. If this trend continued (and compounded) for a year, the Canadian economy would be 5.4% smaller. On the other hand, this decline was not bad enough to […]
Read moreSome newspapers have paid some well-deserved attention to the multi-million dollar bonuses recently handed to the executives of the Canada Pension Plan Investment Board (CPPIB) after they lost $24 billion of Canadian workers’ pension savings with their investments last year. What has received less attention are the low long-term rates of return that the CPPIB has earned in the ten […]
Read moreThere was a problem before the recession in terms of EI claimants exhausting their benefits before finding a new job, and it will soon get much worse. In 2006-07, before the recession, the national unemployment rate averaged just over 6%. Nonetheless, there were over 1.3 million new regular EI claims filed over the year, reflecting the fact that many Canadian […]
Read moreIf the federal deficit for 2009-10 soars by more than $16 Billion from $34 Billion to over $50 Billion, it won’t be mainly because of a jump in EI expenditures as Finance Minister Flaherty seems to have suggested. True, the 2009 Budget EI projections now look badly wrong. The forecast increase in total EI spending from 2008-09 to 2009-10 was […]
Read moreIn all the kerfuffle around Finance Minister Flaherty’s $50 billion deficit projection, the cost of the joint federal-Ontario support for the restructuring of GM and Chrysler has been getting a lot of attention. But while that restructuring support is an important and expensive undertaking, there’s no way it should be fingered as the major cause (or even a leading cause) […]
Read moreMarch’s large increase in Employment Insurance (EI) recipients was no surprise given mass layoffs and February’s record-high number of EI benefit claims. But when compared to Labour Force Survey figures on March unemployment, today’s figures provide a sobering reminder that well below half of unemployed Canadians receive EI benefits. Employment Insurance Coverage, March 2009   EI Recipients Unemployment EI […]
Read moreThe PEF will once again be hosting panels at this year’s Canadian Economics Association meetings, May 29-31 in Toronto. We are sponsoring a record nine panels, plus our AGM and a Keynote by Paul Davidson. On behalf of the PEF, I would like to thank the Canadian Economics Association for a small grant that facilitates our participation. I think the […]
Read moreSo says a new paper by UBC economist Phil Oreopoulos, Why Do Skilled Immigrants Struggle in the Labor Market? A Field Experiment with Six Thousand Resumes. As a skilled immigrant with a non-Anglo sounding name I find this quite disturbing. As should native-born Canadians who like to think that their country is tolerant and welcoming to all. The paper examines […]
Read moreToday’s Consumer Price Index provides an important reminder that, despite expansive monetary policy from central banks and perceived “green shoots†in the economy, deflation remains a more serious risk than rising inflation. In April, the national inflation rate fell to 0.4%. Four provinces – Alberta, Nova Scotia, New Brunswick and Prince Edward Island – posted negative inflation rates. While falling […]
Read moreA thoughtful op ed from today’s Ottawa Citizen by Peter Victor, the author of “Managing Without Growth” (Edward Elgar)Â on the case for a no growth future. http://www.ottawacitizen.com/business/fp/Bigger+better/1590471/story.html Here’s an extract: “Although no 21st-century Keynes has emerged to prepare the intellectual ground for such a change in thinking, we do have a body of knowledge built up over many decades […]
Read moreThree-peat. Hat trick. The media is full of jubilation for the re-election of the Campbell Liberals. But looking at the numbers, it was actually quite close: the BC Liberals got 45.7% of the popular vote, compared to 42.2% for the NDP. This slim margin validates the Angus Reid polling camp, which came closest on estimating the popular vote, compared to […]
Read moreErin has already posted a comment on last month’s surge in self employment . http://www.progressive-economics.ca/2009/05/08/do-it-yourself-recovery/ My colleague Sylvain Schetagne extracted some data from the Labour Force micro data file to get a better handle on the change last month – note these are NOT seasonally adjusted data so they should be interpreted with a bit of caution. The not seasonally […]
Read moreThe new EI Monitoring and Assessment Report provides some useful information about access before the crisis. http://www.hrsdc.gc.ca/eng/employment/ei/reports/eimar_2008/index.shtml In 2007, about one in five (17.7%) of EI premium payers who were laid-off did not qualify for access to EI due specifically to a lack of enough hours of insured work, including 66% of (mainly women) part-time workers and 54% of young […]
Read moreThe 2008 Employment Insurance Monitoring and Assessment Report provides some useful information on the state of active labour market policy in Canada before the recession, much more, in fact, than in previous reports. http://www.hrsdc.gc.ca/eng/employment/ei/reports/eimar_2008/index.shtml EI Part II Funds are transferred to the provinces through Labour Market Development Agreements (or LMDAs) which are used (almost entirely) to provide employment benefits (programs) […]
Read moreHere is my take on today’s Labour Force Survey: Self-Employment Surge April’s apparent gain in employment was entirely due to increased self-employment. Specifically, total employment rose by 36,000 while self-employment rose by 37,000, meaning that 1,000 fewer Canadians were paid by employers last month. One must ask whether more Canadians are becoming self-employed voluntarily or because they cannot find jobs […]
Read moreBut you wouldn’t know it if you listened to the message that the BC Liberals have been sending in this provincial election campaign. Instead of discussing the merits of his party’s proposed economic recovery policy, the incumbent Premier prefers to tell British Columbians that responsible economic stewardship involves keeping the business sector happy and anything that goes against the interests […]
Read moreA year ago, the Harper Conservatives blocked a proposed foreign takeover under the Investment Canada Act for the first time ever. Today, they announced an effort to hold US Steel to commitments it made under the Act in taking over Stelco. Here is what I said to the Business News Network, Canadian Press and The Financial Post. The union’s press release follows. […]
Read moreLast week economists at the TD Bank called for uniform entrance requirements for the Employment Insurance program (although not as low as we’d like).  This week in an article in the Globe and Mail, TD Bank’s chief economist Don Drummond has called into question the effectiveness of the RRSP system and suggested that we need stronger public pensions, such as higher benefits through the Canada […]
Read moreHaving been chastised for giving what I thought was faint praise to Iggy for moving on EI a couple of days ago , I’m going to really, really stick my head out here and wonder if Alan Greenspan has a point when it comes to potential positive linkages between the stock market and the real economy. http://blogs.ft.com/capitalismblog/2009/03/30/equities-show-us-the-way-to-recovery/ I think that […]
Read moreIn an op-ed printed in today’s Toronto Star, Ken Neumann (Canadian Director of the United Steelworkers) outlines how unions provide a better economic deal and more workplace rights for both union members and unorganized workers. Opinion – Even during downturns there is power in a union MARGARET SCOTT/NEWSART Unions not only win better wages but also help weave a stronger […]
Read moreAs an early booster of Jim Maloway’s private member’s bill, I am delighted to see it already achieving some results. Yesterday’s Globe reported that the airlines have countered by giving “new enforcement powers to CTA to serve as the industry watchdog on a range of consumer issues. They include ensuring airlines provide meal vouchers for four-hour delays, pay for hotel […]
Read moreAt long last, people are starting to get it. As recognized by the Globe and Mail in an editorial today (May 4) and by the TD Bank inthe study put out last Friday, our current EI system is leaving far too many unemployed Canadians out in the cold. Only four in ten unemployed workers currently even qualify for income support from […]
Read moreCanadian governments should revisit planned corporate tax cuts in light of President Obama’s proposals to more fully tax American firms operating outside the US. The basic argument for lower corporate tax rates is that they will attract multinational firms to locate operations here as opposed to other jurisdictions. This argument assumes that profits are taxed only where they are generated. But […]
Read moreTD Economics have provided a useful study on possible reforms to our inadequate EI system which has left tens of thousands of unemployed workers out in the cold, and indaequate benefits to those who do qualify. http://www.td.com/economics/special/gb0409_EI.pdf The focus of this report is on those excluded from the system by the variable entrance requirement or VER – the unemployment rate […]
Read moreYesterday’s Financial Post featured a rather strange op-ed by the Fraser Institute’s current and former directors of fiscal studies: Most Canadians are unfortunately not aware of Canada’s 15-year track record of reducing the size of government (1992-2007). Since peaking in 1992, the size of government in Canada – best measured by total spending at all levels of government as a […]
Read moreStatistics Canada has revealed that, adjusted for inflation, Gross Domestic Product (GDP) declined by 0.1% in February. This decline is on par with September and October, but far less severe than November (-0.7%), December (-1.0%), and January (-0.7%). There are grounds for hope in that a slower pace of decline is a necessary precondition for a return to economic growth. […]
Read moreWith my oped last week on the NDP platform making me less than popular over at NDP HQ, today the Sun published my take on the Liberals’ platform, thereby guaranteeing that the list of Christmas parties I get invited to dwindles to next to nothing. BC’s Economic Challenges and the Liberal Platform By Marc Lee The BC Liberal platform features […]
Read moreI’m posting below an interesting missive from Peter Bakvis, the Washington representative of the International Trade Union Confederation, on an intersting shift of position on labour rights by the IFI.s “The World Bank has issued a memorandum to its country and sector directors instructing them to stop using the “Employing Workers Indicator” (EWI) of its highest-circulation publication, “Doing Business” (DB). […]
Read moreBC’s recession started in 2008. That is the upshot of today’s release of Statistics Canada’s Provincial Economic Accounts, which provides the first estimates of BC’s GDP for 2008. Unlike national data, which are provided quarterly and on a timely basis, we have to wait about four months to tally the various provincial beans. These numbers will inevitably be revised in […]
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