(This covers some familiar ground, but I was asked to summarize a presentation I made to a Columbia Institute organized session for progressive locally elected officials last week and thought it might be of wider interest.) The world and Canada are in the deepest economic downturn since the 1930s as the financial crisis has spread with a vengeance into the […]
Read moreToday’s Employment Insurance (EI) figures confirm that fewer than half of unemployed Canadians received EI benefits in April. Although 18,600 more Canadians received benefits in April than in March, this was the smallest increase in six months. The relatively modest increase in EI beneficiaries corresponds to a relatively small increase in official unemployment during April, the month in which the […]
Read moreErin Weir had a highly useful post on this subject a few days ago. Now here’s a chance to take some action: The Centre for Research on Work and Society at York is circulating the Open Statement below regarding the U.S. debate over the Employee Free Choice Act, and certain arguments that have been made in that debate regarding Canadian […]
Read moreThis morning’s Consumer Price Index data reveals that the national inflation rate fell to 0.1% in May. Four provinces – Alberta, New Brunswick, Nova Scotia, and Prince Edward Island – posted negative inflation rates. The supposed risk of continuing fiscal and monetary stimulus too long is that they could propel accelerating inflation. The Finance Minister and Bank of Canada Governor have […]
Read moreThree months ago, Anne Layne-Farrar intervened in the US debate about the Employee Free Choice Act (EFCA) with a widely-reported paper and Senate testimony. She used Canadian data to argue that the proposed legislation would eliminate 600,000 American jobs. As many critics have noted, Layne-Farrar works for a corporate consultancy and business funded this piece of research. Readers can take […]
Read morePolitical debate and media reporting on today’s economic “Report to Canadians” have emphasized one of the first tables in the document, in which the government claims to have “committed” 80% of budgeted stimulus spending (page 14 of 230). Equally interesting, but perhaps less noticed, are the two “Fiscal Outlook” tables near the end of the document (pages 219 and 221). […]
Read moreThe credit crisis, which sharply increased private borrowing costs but reduced government borrowing costs, highlights the potential advantage of having a public agency to finance economic development. The front page of today’s Regina Leader-Post features a report on my union’s letter (full text below) to the Government of Canada about Evraz using its Canadian facilities as collateral to borrow from Russia’s national development […]
Read moreIn my career of writing letters to my hometown newspaper, my favourite headline supplied by the Regina Leader-Post was “Deficit Caused by Tax Cuts,†for a letter arguing that Saskatchewan’s mild deficit a few years ago resulted from provincial tax cuts rather than from alleged overspending. Today’s inane press release from Finance Canada, lauding the fact that “Tax Freedom Day” […]
Read moreAccording to today’s Labour Force Survey, the national unemployment increase (83,800) was twice the employment decrease (41,800) in May. The explanation is that the labour force expanded by 42,000 as Canada’s population continued to grow. While some people are entering the labour market and getting jobs, many more are being laid off. As a result, total unemployment blew past the […]
Read moreI recently had the pleasure of serving with Stephen Gordon on a panel about economics and blogging. Over at Worthwhile Canadian Initiative, he has been leading a one-man crusade against reducing the eligibility requirement for Employment Insurance (EI) benefits to 360 hours. His stated goal is to provide better protection for unemployed workers and counter-cyclical fiscal policy. It strikes me […]
Read moreThe conventional wisdom seems to be that the financial situation of Canadian households is generally sound and certainly much better than that of our profligate and heavily indebted American neighbours. The Bank of Canada argued in its end of 2008 Financial System Review that “(O)verall, despite a modest deterioration, the financial position of the Canadian household sector remains relatively positive.” […]
Read moreOne question that has long been of concern to me – and for which relevant data are very limited – is the permanency of recent manufacturing job losses. We know that tesn of thousands of jobs have been lost, but not how many job losses are due to the permanent closure of facilities. A paper by Patrice Jalette and Natacha […]
Read moreHere’s an extremely well-written and cogent commentary on the state of the banking system and the grim consequences for the rest of us, especially in the UK, by novelist John Lanchester, from the London Review of Books. He’s at work on a book on the same topic http://www.lrb.co.uk/v31/n10/lanc01_.html
Read moreCanadian newspapers have recently been flooded with negative stories about Buy America, largely focussed on a single scandalous incident at a Marine base in California. The potential damage to Canada’s economy has been vastly overstated. To the extent that Buy America shifts US government contracts from offshore suppliers to American manufacturers that use Canadian components, Canada actually benefits. Overall, Obama’s massive […]
Read moreMy 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 […]
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