Economy

ALDRICH: Economy needs attention, too – Winnipeg Sun

Published

5 years ago

March 31, 2020

The effects of COVID-19 are being felt well beyond the health and wellbeing of the community.

While keeping people safe should absolutely be the priority, we have to keep one eye on the economy. We are going to need to be able to function as a society once the fog of this pandemic lifts.

Perhaps the most difficult part to that is the fact the coronavirus is already unprecedented in our modern world in how it has shut down the economy.

It is estimated by many observers that the federal deficit will hit $150 billion, much of which is due to pandemic spending and economic packages and supports for the unemployed and businesses facing economic hardship.

The province is also looking to blow past any concept of sticking to their budget and last week asked Ottawa to use its financial weight to help provinces get a better rate on loans, adding Manitoba would be looking for $10 billion in loans.

It is worth noting, Canada will hardly be alone in this deficit spending and borrowing. The U.S. recently announced a $2 trillion COVID-19 package.

This is while the Canadian Federation of Independent Businesses last week estimated a third of Canada’s small- to medium-sized business would not survive COVID-19. On Monday, they were estimating 21% of small businesses in Manitoba will have difficulty paying rent next month with another 11% reporting they don’t know if they will be able to.

Loren Remillard, president and CEO of the Winnipeg Chamber of Commerce, said he has seen similar numbers in Winnipeg, noting a week and a half ago, a large number of businesses said they had enough cash to float the business for 30 days. After that, it was a big question mark

These businesses will be critical to recovery as they were in the crash of 2008.

“I believe it was 80-90% of the new jobs created post-’08 were led by the small- and medium-sized enterprises of this country — a million jobs created by those companies,” he said. “We recognize the role those businesses have played coming out of crises and driving our economy back to ensure the quality of life we all enjoy.”

The chamber has been successful in lobbying for better supports for businesses from the federal government, including $40,000 interest-free loans and improved funding for employment support packages.

Something that will be important to watch is how the energy economy in Alberta is crumbling. It still had not completely bounced back from the last recession when oil powers Saudi Arabia and Russia undercut the price of oil and it has been in free fall to single digits for the price of Alberta crude.

Like it or not, our financial fate is still largely tied to the Alberta oil fields. The further oil drops, the fewer rigs are in operation and the fewer oil workers are collecting their big paycheques. That means the less money there is heading east in equalization payments.

Manitoba has a much more diversified economy, but still collected more than $2 billion last year in transfer payments.

“That’s the big problem going forward,” said Phil Cyrenne, professor of economics University of Winnipeg. “Most of the equalization is central to funding the public service.”

As a silver lining to the crisis, COVID-19 will force companies to adapt to more efficient ways of operation. Specifically, we are discovering just how many people can work from home which will allow companies to examine just how big of an office footprint they need. They can run leaner and potentially more effectively.

It is also forcing more companies online who may not have been online previously, thus opening up new markets to them.

While this is seen as a survival tactic right now, encouraged by the chamber to their members, the impact could be huge going forward.

“If this had happened 10 or 20 years ago, the effects would be even way worse,” said Cyrenne. “I think technology has allowed us to escape even some of the constraints in some sectors.”

We have some awful times ahead of us, but there is a light at the end of the tunnel.

jaldrich@postmedia.com

Twitter: @JoshAldrich03

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Economy

Minimum wage to hire higher-paid temporary foreign workers set to increase

Published

2 days ago

October 21, 2024

Anne Joseph

OTTAWA – The federal government is expected to boost the minimum hourly wage that must be paid to temporary foreign workers in the high-wage stream as a way to encourage employers to hire more Canadian staff.

Under the current program’s high-wage labour market impact assessment (LMIA) stream, an employer must pay at least the median income in their province to qualify for a permit. A government official, who The Canadian Press is not naming because they are not authorized to speak publicly about the change, said Employment Minister Randy Boissonnault will announce Tuesday that the threshold will increase to 20 per cent above the provincial median hourly wage.

The change is scheduled to come into force on Nov. 8.

As with previous changes to the Temporary Foreign Worker program, the government’s goal is to encourage employers to hire more Canadian workers. The Liberal government has faced criticism for increasing the number of temporary residents allowed into Canada, which many have linked to housing shortages and a higher cost of living.

The program has also come under fire for allegations of mistreatment of workers.

A LMIA is required for an employer to hire a temporary foreign worker, and is used to demonstrate there aren’t enough Canadian workers to fill the positions they are filling.

In Ontario, the median hourly wage is $28.39 for the high-wage bracket, so once the change takes effect an employer will need to pay at least $34.07 per hour.

The government official estimates this change will affect up to 34,000 workers under the LMIA high-wage stream. Existing work permits will not be affected, but the official said the planned change will affect their renewals.

According to public data from Immigration, Refugees and Citizenship Canada, 183,820 temporary foreign worker permits became effective in 2023. That was up from 98,025 in 2019 — an 88 per cent increase.

The upcoming change is the latest in a series of moves to tighten eligibility rules in order to limit temporary residents, including international students and foreign workers. Those changes include imposing caps on the percentage of low-wage foreign workers in some sectors and ending permits in metropolitan areas with high unemployment rates.

Temporary foreign workers in the agriculture sector are not affected by past rule changes.

This report by The Canadian Press was first published Oct. 21, 2024.

— With files from Nojoud Al Mallees

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Economy

PBO projects deficit exceeded Liberals’ $40B pledge, economy to rebound in 2025

Published

6 days ago

October 17, 2024

Anne Joseph

OTTAWA – The parliamentary budget officer says the federal government likely failed to keep its deficit below its promised $40 billion cap in the last fiscal year.

However the PBO also projects in its latest economic and fiscal outlook today that weak economic growth this year will begin to rebound in 2025.

The budget watchdog estimates in its report that the federal government posted a $46.8 billion deficit for the 2023-24 fiscal year.

Finance Minister Chrystia Freeland pledged a year ago to keep the deficit capped at $40 billion and in her spring budget said the deficit for 2023-24 stayed in line with that promise.

The final tally of the last year’s deficit will be confirmed when the government publishes its annual public accounts report this fall.

The PBO says economic growth will remain tepid this year but will rebound in 2025 as the Bank of Canada’s interest rate cuts stimulate spending and business investment.

This report by The Canadian Press was first published Oct. 17, 2024.

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Economy

Statistics Canada says levels of food insecurity rose in 2022

Published

7 days ago

October 16, 2024

Anne Joseph

OTTAWA – Statistics Canada says the level of food insecurity increased in 2022 as inflation hit peak levels.

In a report using data from the Canadian community health survey, the agency says 15.6 per cent of households experienced some level of food insecurity in 2022 after being relatively stable from 2017 to 2021.

The reading was up from 9.6 per cent in 2017 and 11.6 per cent in 2018.

Statistics Canada says the prevalence of household food insecurity was slightly lower and stable during the pandemic years as it fell to 8.5 per cent in the fall of 2020 and 9.1 per cent in 2021.

In addition to an increase in the prevalence of food insecurity in 2022, the agency says there was an increase in the severity as more households reported moderate or severe food insecurity.

It also noted an increase in the number of Canadians living in moderately or severely food insecure households was also seen in the Canadian income survey data collected in the first half of 2023.

This report by The Canadian Press was first published Oct 16, 2024.

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