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Economy Still Strong But Slowing – Forbes

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Two measures always lead the monthly round of economic indicators. One is the Labor Department’s detailed report on jobs growth and unemployment. The other is a report on manufacturers from the Institute of Supply Management (ISM), a private industry group. For March, these indicators each paint a similar picture: The U.S. economy is continuing its post-pandemic recovery, but the pace is slowing, and inflation shows no sign of abating.

Aspects of the Labor Department’s report do have an upbeat tone. Unemployment continues to decline. The number of Americans unable to find work dropped in March by some 318,000 to 5.95 million, a 5.1% drop from February and 9.0% lower than January. The rate of unemployment as a percent of the available workforce fell to 3.6%, down from 3.8% in February and 4.0% in January. Unemployment is way below the 6.0% rate recorded this time last year and gets very close to the 3.5% pre-pandemic near-record low.

Equally encouraging is how widespread the gains were. Adult male unemployment fell to 3.4% in March from 3.5% in February. Adult women were doing even better. There unemployment rate stood at 3.3% in March, down from 3.6% in February. Teen unemployment at 10.0% was down from 10.3% in February and well down from the 12.7% of a year ago. Black unemployment came in 6.2% of that workforce, a striking one-month improvement from February’s 6.6% rate and 9.5% a year ago. The Hispanic unemployment rate was 4.2% in March, down slightly from 4.4% in February and more from 7.7% a year ago, while Asian unemployment at 2.8% was truly striking, down from 3.6% on February and 5.9% a year ago.

The Labor Department’s employer survey shows that the country created some 431,000 new jobs in March. This is a good showing compared with the long historical sweep, but considerably less impressive when compared to the last 12 months, which showed a considerably higher monthly job gain of almost 600,000 on average. Clearly the pace of gain, though still good, is slowing.

That the country is leaving the post-pandemic boom behind is still more evident in the industry detail. Half the jobs slowdown between February and March occurred in retail trade and the leisure and hospitality sector. These two areas were hardest hit in the lockdowns and quarantines and consequently have been leaders in the recovery. Now, clearly, they are slowing. It is also noteworthy in this regard that temporary help showed a significant slowdown in growth and transportation and warehousing suffered small outright declines in employment between February and March.

Wages continued to grow, with the hourly rate up 3.7% from a year ago and the weekly figure, which accounts for overtime, up 4.6% over the same time. That jump has no doubt contributed to a welcome, albeit small rise in the percent of the civilian population either working or looking for work. This so-called participation rate rose from 62.3% in February to 62.4% in March. That is a small shift but an impressive improvement from the 61.5% participation rate recorded 12 months ago when the federal government was still offering a premium unemployment payout. But for all the encouragement offered by the wage hikes, they still fall short of inflation of between 7% and 8% during the past year. Working men and women are running to catch up.

The ISM release paints a similar picture but in brighter colors. This measure weighs firms reporting declines against those reporting increases and so a figure of 50 marks the difference between increase and decline. The overall index for economic activity stood at 57.1 for March. That is well above 50, certainly indicating continued recovery, but it is nonetheless down sharply from February’s index of 59.0 and 60 from late last year. The developing slowdown is even more evident in the forward-looking index for new orders. The March figure of 53.8 is down sharply from February’s index of 61.7. The same could be said about production. At 54.5 for March, it is well below February’s 58.5 and even further below December’s figure of 60.0. The inflation news is troubling. The index for prices to manufacturers stood at a very high 87.1 in March, up from an also high 75.6 in February and 68.2 last December.

The slowdown in the intensity of business activity has marginally eased supply-chain problems. Inventories are more robust. The measure here came in at 55.5 for March, up from 53.6 in February and 53.2 in January. Even customer inventories are catching up. These stood at 34.1 in March, still low but up nonetheless from 31.8 in February. Backlogs have also abated. These fell to a measure of 60.0 in March, still high but down from 65.0 in February. Consistent with the Labor Department’s report, the ISM group reports a rise in the employment index to 56.3 in March from 52.9 in February. Otherwise, the slowing recovery is evident.

None of this should surprise. The inflation has been building steadily for months. As for the slowing in the recovery, any economy would rebound sharply from artificial constraints, as the lockdowns and quarantines were, but once it catches up with what was lost, it almost always slows. That is what is happening in the United States now. When that catchup is complete, likely in the second half of this year, the pace of growth should resume its much slower trend rate for both output and employment.

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A timeline of events in the bread price-fixing scandal

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Almost seven years since news broke of an alleged conspiracy to fix the price of packaged bread across Canada, the saga isn’t over: the Competition Bureau continues to investigate the companies that may have been involved, and two class-action lawsuits continue to work their way through the courts.

Here’s a timeline of key events in the bread price-fixing case.

Oct. 31, 2017: The Competition Bureau says it’s investigating allegations of bread price-fixing and that it was granted search warrants in the case. Several grocers confirm they are co-operating in the probe.

Dec. 19, 2017: Loblaw and George Weston say they participated in an “industry-wide price-fixing arrangement” to raise the price of packaged bread. The companies say they have been co-operating in the Competition Bureau’s investigation since March 2015, when they self-reported to the bureau upon discovering anti-competitive behaviour, and are receiving immunity from prosecution. They announce they are offering $25 gift cards to customers amid the ongoing investigation into alleged bread price-fixing.

Jan. 31, 2018: In court documents, the Competition Bureau says at least $1.50 was added to the price of a loaf of bread between about 2001 and 2016.

Dec. 20, 2019: A class-action lawsuit in a Quebec court against multiple grocers and food companies is certified against a number of companies allegedly involved in bread price-fixing, including Loblaw, George Weston, Metro, Sobeys, Walmart Canada, Canada Bread and Giant Tiger (which have all denied involvement, except for Loblaw and George Weston, which later settled with the plaintiffs).

Dec. 31, 2021: A class-action lawsuit in an Ontario court covering all Canadian residents except those in Quebec who bought packaged bread from a company named in the suit is certified against roughly the same group of companies.

June 21, 2023: Bakery giant Canada Bread Co. is fined $50 million after pleading guilty to four counts of price-fixing under the Competition Act as part of the Competition Bureau’s ongoing investigation.

Oct. 25 2023: Canada Bread files a statement of defence in the Ontario class action denying participating in the alleged conspiracy and saying any anti-competitive behaviour it participated in was at the direction and to the benefit of its then-majority owner Maple Leaf Foods, which is not a defendant in the case (neither is its current owner Grupo Bimbo). Maple Leaf calls Canada Bread’s accusations “baseless.”

Dec. 20, 2023: Metro files new documents in the Ontario class action accusing Loblaw and its parent company George Weston of conspiring to implicate it in the alleged scheme, denying involvement. Sobeys has made a similar claim. The two companies deny the allegations.

July 25, 2024: Loblaw and George Weston say they agreed to pay a combined $500 million to settle both the Ontario and Quebec class-action lawsuits. Loblaw’s share of the settlement includes a $96-million credit for the gift cards it gave out years earlier.

Sept. 12, 2024: Canada Bread files new documents in Ontario court as part of the class action, claiming Maple Leaf used it as a “shield” to avoid liability in the alleged scheme. Maple Leaf was a majority shareholder of Canada Bread until 2014, and the company claims it’s liable for any price-fixing activity. Maple Leaf refutes the claims.

This report by The Canadian Press was first published Sept. 19, 2024.

Companies in this story: (TSX:L, TSX:MFI, TSX:MRU, TSX:EMP.A, TSX:WN)

The Canadian Press. All rights reserved.

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S&P/TSX composite up more than 250 points, U.S. stock markets also higher

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TORONTO – Canada’s main stock index was up more than 250 points in late-morning trading, led by strength in the base metal and technology sectors, while U.S. stock markets also charged higher.

The S&P/TSX composite index was up 254.62 points at 23,847.22.

In New York, the Dow Jones industrial average was up 432.77 points at 41,935.87. The S&P 500 index was up 96.38 points at 5,714.64, while the Nasdaq composite was up 486.12 points at 18,059.42.

The Canadian dollar traded for 73.68 cents US compared with 73.58 cents US on Thursday.

The November crude oil contract was up 89 cents at US$70.77 per barrel and the October natural gas contract was down a penny at US2.27 per mmBTU.

The December gold contract was up US$9.40 at US$2,608.00 an ounce and the December copper contract was up four cents at US$4.33 a pound.

This report by The Canadian Press was first published Sept. 19, 2024.

Companies in this story: (TSX:GSPTSE, TSX:CADUSD)

The Canadian Press. All rights reserved.

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Construction wraps on indoor supervised site for people who inhale drugs in Vancouver

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VANCOUVER – Supervised injection sites are saving the lives of drug users everyday, but the same support is not being offered to people who inhale illicit drugs, the head of the BC Centre for Excellence in HIV/AIDS says.

Dr. Julio Montaner said the construction of Vancouver’s first indoor supervised site for people who inhale drugs comes as the percentage of people who die from smoking drugs continues to climb.

The location in the Downtown Eastside at the Hope to Health Research and Innovation Centre was unveiled Wednesday after construction was complete, and Montaner said people could start using the specialized rooms in a matter of weeks after final approvals from the city and federal government.

“If we don’t create mechanisms for these individuals to be able to use safely and engage with the medical system, and generate points of entry into the medical system, we will never be able to solve the problem,” he said.

“Now, I’m not here to tell you that we will fix it tomorrow, but denying it or ignoring it, or throw it under the bus, or under the carpet is no way to fix it, so we need to take proactive action.”

Nearly two-thirds of overdose deaths in British Columbia in 2023 came after smoking illicit drugs, yet only 40 per cent of supervised consumption sites in the province offer a safe place to smoke, often outdoors, in a tent.

The centre has been running a supervised injection site for years which sees more than a thousand people monthly and last month resuscitated five people who were overdosing.

The new facilities offer indoor, individual, negative-pressure rooms that allow fresh air to circulate and can clear out smoke in 30 to 60 seconds while users are monitored by trained nurses.

Advocates calling for more supervised inhalation sites have previously said the rules for setting up sites are overly complicated at a time when the province is facing an overdose crisis.

More than 15,000 people have died of overdoses since the public health emergency was declared in B.C. in April 2016.

Kate Salters, a senior researcher at the centre, said they worked with mechanical and chemical engineers to make sure the site is up to code and abidies by the highest standard of occupational health and safety.

“This is just another tool in our tool box to make sure that we’re offering life-saving services to those who are using drugs,” she said.

Montaner acknowledged the process to get the site up and running took “an inordinate amount of time,” but said the centre worked hard to follow all regulations.

“We feel that doing this right, with appropriate scientific background, in a medically supervised environment, etc, etc, allows us to derive the data that ultimately will be sufficiently convincing for not just our leaders, but also the leaders across the country and across the world, to embrace the strategies that we are trying to develop.” he said.

Montaner said building the facility was possible thanks to a single $4-million donation from a longtime supporter.

Construction finished with less than a week before the launch of the next provincial election campaign and within a year of the next federal election.

Montaner said he is concerned about “some of the things that have been said publicly by some of the political leaders in the province and in the country.”

“We want to bring awareness to the people that this is a serious undertaking. This is a very massive investment, and we need to protect it for the benefit of people who are unfortunately drug dependent.” he said.

This report by The Canadian Press was first published Sept. 18, 2024.

The Canadian Press. All rights reserved.

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