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157,000 new jobs in September get Canada's economy back above pre-pandemic level – CBC.ca

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Canada’s economy added 157,000 new jobs last month, Statistics Canada says, enough to put employment numbers back above where they were before the pandemic started.

The jobs surge was more than twice as big as the 60,000 new jobs that economists were expecting.

It was also enough to push the jobless rate down two ticks to 6.9 per cent. That’s the lowest unemployment rate since the pandemic started.

Before the pandemic, Canada’s jobless rate was 5.6 per cent. It jumped up sharply in March, April and May of 2020, peaking at 13.7 per cent in May of last year, and has trended downward ever since.

While there are now the same number of jobs as there were before COVID-19 arrived in Canada, that doesn’t necessarily mean people are working as much as they were before.

The number of people working less than half the hours they would normally do is still 218,000 people higher than were doing so in February 2020. And the total number of hours worked by all employees is still 1.5 per cent below the pre-pandemic level, despite there being more jobs now.

But long-term joblessness persists

And there are troubling signs that plenty of people are being left behind, even as the job market expands. The number of people considered to be long-term unemployed — which means they haven’t had a job for at least 27 weeks in a row, or about six months — is now twice was it was before the pandemic, at 389,000 people. That ‘s more than a quarter of everyone without a job.

Leah Nord with the Canadian Chamber of Commerce says that’s a bad sign.

“It’s important to celebrate the encouraging gains we are seeing in employment numbers over the past month, yet we also cannot afford to sweep under the rug those numbers,” she said. “In the midst of a mass labour shortage, 27.3 per cent of unemployed Canadians are unaccounted for. Where did they go?”

“Canadians want to work; most are not unemployed by choice, so we need to dig down and find out exactly what’s holding them back so we can make evidence-based decisions. Our full economic recovery depends on it.”

Economist Sri Thanabalasingam with TD Bank agrees that long-term unemployment is concerning, but he’s not ringing alarm bells just yet.

The glut of people having trouble getting back into the workforce “could be reflecting the difficulties faced by long-term unemployed Canadians in finding new jobs, perhaps due to a deterioration of skill sets,” he said. 

“That said, ongoing income support programs, such as the Canada recovery benefit, may also be a contributing factor. This program, among others, is expiring at the end of the month, which could lead to more people rejoining the workforce in October, that is, unless it is extended.”

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Canada criticizes proposed U.S. EV tax credit, says could harm auto sector

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The Canadian government on Friday warned that U.S. Legislative proposals to create new electric vehicle tax credits for American-built vehicles could harm the North American auto industry and run afoul of trade agreements, according to a letter seen by Reuters.

Canadian Trade Minister Mary Ng told U.S. lawmakers proposed credits if approved “would have a major adverse impact on the future of EV and automotive production in Canada, resulting in the risk of severe economic harm and tens of thousands of job losses in one of Canada’s largest manufacturing sectors. U.S. companies and workers would not be isolated from these impacts.”

 

(Reporting by David Shepardson in Washington and David Ljunggren in Ottawa; Editing by Chris Reese)

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Province Invests in Midland Automotive Parts Manufacturer to Boost Local Economy | Ontario Newsroom – Government of Ontario News

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Province Invests in Midland Automotive Parts Manufacturer to Boost Local Economy | Ontario Newsroom  Government of Ontario News



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UK's economy gathers speed, inflation pressures mount – PMIs – Financial Post

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LONDON — Britain’s economy unexpectedly regained momentum in October and cost pressures rose by the most in more than 25 years, according to a survey on Friday that could encourage the Bank of England to raise interest rates for the first time since the pandemic.

The preliminary “flash” IHS Markit/CIPS flash Composite Purchasing Managers’ Index rose by the largest amount since May to hit 56.8 from September’s 54.9. By contrast, a Reuters poll of economists had pointed to a further slowdown to 54.0.

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“The UK economy picked up speed again in October, but the expansion is looking increasingly dependent on the service sector, which in turn looks prone to a slowdown amid the recent rise in COVID-19 cases,” said IHS Markit’s chief business economist, Chris Williamson.

The rise in the PMI was driven by Britain’s services firms as consumers and businesses picked up their spending. Travel firms benefited from a relaxation of COVID-19 travel rules.

Service sector activity outpaced manufacturing output by the widest margin since 2009 as factories struggled again with shortages of supplies and staff and recorded barely any growth.

A rise in overall employment was close to August’s record high, despite problems in filling vacancies.

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Higher wages and the worsening supply shortages resulted in the fastest increase in average costs since the combined composite index was launched in January 1998. Separate PMIs for the services and manufacturing sectors showed prices charged by firms rose by the most since these series began in 1996 and 1992 respectively.

With inflation set to hit more than double its 2% target soon, the BoE is expected to raise borrowing costs soon as it tries to make sure that rising inflation expectations do not become embedded in British businesses’ pricing decisions.

The Confederation of British Industry said on Thursday that manufacturers were raising prices by the most since 1980 in the face of some of the biggest increases in costs and labor shortages since the 1970s.

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The PMI for the services sector rose to 58.0, its highest in three months, while the manufacturing PMI’s output component – which IHS Markit says currently gives a better picture of the sector than the headline index – sank to its lowest since February at 50.6.

Despite the improved picture for most companies, many consumers are concerned about the outlook for the economy.

A survey published earlier on Friday showed Britons were their most downbeat since they February, when they were under lockdown, and are increasingly worried about the year to come as prices and COVID cases rise. (Reporting by William Schomberg; Editing by Hugh Lawson)

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