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Blip or trend? This week will test Canada's job-creation machine: Don Pittis – CBC.ca

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While Canadians were constantly goaded into a state of economic anxiety over the past year, as the dust settled, it was pretty clear the country was coming out of 2019 in a surprisingly healthy state.

Still, at the beginning of December, just when things were going good and following a year of stunning job creation and unemployment near record lows, the twenty-teens closed with a new piece of ominous economic data that led many to wonder whether the trajectory of the Canadian economy had changed.

On the same day the U.S. announced it had cranked out more than 266,000 jobs, pushing unemployment to 3.5 per cent, Canada headed in the opposite direction.

According to Statistics Canada’s last Labour Force Survey, the number of Canadian jobs plunged by more than 71,000 — the biggest one-month employment loss since 2009, when the economy was still in the throes of the Great Recession.

Unemployment rose to 5.9 per cent, up from 5.5 per cent in October.

The data was especially shocking because forecasts from economists at the big financial institutions had predicted a net increase of 10,000 jobs.

Staggering losses

As some observers pointed out at the time, with the Canadian population being about 10 per cent of that of the U.S., it was roughly the equivalent of a staggering 700,000 job losses south of the border. On the other hand, as the Wall Street Journal reminded us, Canada’s 5.9 per cent unemployment rate would have been 4.7 per cent if calculated using U.S. methods.

The Canadian job decline did not come completely out of the blue. After strong job creation in August and September, October’s data also showed a slight drop in jobs.

The question raised by government critics and commentators in the days after the report was whether the new data was somehow a statistical misreading in a data collection system that is notoriously volatile from month to month. Or, alternatively, if something important had changed.

Was it a blip? Or is it a trend?

A truck passes an employee walkway at the GM assembly plant in Oshawa, Ont., where the operation’s closure will contribute to a loss in manufacturing jobs in December. (Chris Helgren/Reuters)

A partial answer, at least, will come this week when Statistics Canada releases its final data for 2019 to include the month of December.

As an economic indicator, the Labour Force Survey has some important advantages.

One way of looking at it is that rather than being the proverbial canary in the coal mine, employment data is the actual coal mine. Because what better measure of the economy is there than whether people are working and earning?

Employment data is about the closest we have to a reading of now. Gathered through public interviews of households in days before its release, the Labour Force Survey takes the current pulse of the economy in a way other data cannot.

But that immediacy comes with some flaws.

Room for error

“While we are confident in our methodology, there is variability in the Labour Force Survey estimates, reflecting the nature of the survey,” explained Statistics Canada labour market economist Bertrand Ouellet-Léveillé.

Statisticians understand this in a way that most of us do not. But even with a big sample size, there remains large room for error.

To a statistician, there are about two chances out of three that jobs losses were in a wide range around the minus 71,000 figure, Ouellet-Léveillé said. But there is a one-third chance it is wrong altogether.

That’s why data for a single month should never be read alone, he said, and why it should be used with other sources of information, such as job vacancy and wage data.

Certainly, business leaders have consistently complained that they have hundreds of thousands of jobs still vacant. And wages, rising at 4.5 per cent, or double the rate of inflation, seem to indicate workers remain in demand.

Some blamed the size of November’s job slump on public-sector workers who were no longer needed after the fall federal election. A sharp drop in manufacturing jobs is more ominous, but with demand high, both groups may soon be drawn back into the workforce.

And then there’s inflation. Shortly after that last jobs release, rising prices told a completely different story for the Bank of Canada and the Canadian dollar.

When those jobs numbers were released a month ago today, many analysts took it as a warning that the economy was in trouble. “Biggest jobs loss since 2009 test Canadian resolve on rates,” blared a headline from the business news service Bloomberg.

The Canadian dollar fell.

Top 10 and rising

Many saw the plunge in employment as a sign that the Bank of Canada would have to cut rates to boost the economy. But now a month later, almost no one thinks Canada’s chief central banker Stephen Poloz, or his replacement, taking over in June, will cut interest rates in 2020.

Not only did the dollar begin to rise after the recent inflation numbers, most Canadians would probably be surprised to learn that the loonie was one of the developed world’s powerhouse currencies in 2019, beating out the U.S. greenback by five per cent.

Many other indicators tell us that Canada remains strong. Just last week, the World Economic League Table showed that not only has the Canadian economy knocked out South Korea to once again make it into the global Top 10, but in the coming decade, Canada is expected to climb over the backs of Italy and Brazil to reach No. 8.

Despite signs of an otherwise booming economy, Statistics Canada said Quebec alone lost more than 45,000 jobs in November due to a fall in manufacturing, accommodation and food services. (Christinne Muschi/Reuters)

“Despite the fact that the economy is doing reasonably well, with some regional exceptions, [and] despite the fact that the Canadian middle-class income has been better and more stable than most middle classes around the world at the moment … there is a kind of anxiety out there,” Keith Banting, a public policy specialist at Queen’s University, said in an interview last September.

Last month, Conservative warnings of a made-in-Canada recession helped keep that anxiety alive. And while most domestic and international analysts say the Canadian economy will continue to grow in 2020, a November slump in employment that expands from a blip into a downward spiral would be dangerous signal.

So was it a blip? Or is it a trend? This week’s employment statistics will help settle that debate.


Follow Don on Twitter @don_pittis

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Firing Bank of Canada head would spark global ‘shock wave’: ex-budget watchdog – Global News

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If any Canadian government were to fire the head of the Bank of Canada, the result would be a “global financial shock wave,” warned the country’s former budget watchdog.

In an interview with The West Block guest host Eric Sorenson, former parliamentary budget officer Kevin Page said the Bank of Canada’s reputation is one as a “strong” and “transparent” institution.

“We’ve gotten used to, over the past three decades, having an independent central bank that is independent — making decisions on these policy interest rates that is divorced from the political environment,” said Page, now president and CEO of the Institute of Fiscal Studies and Democracy at the University of Ottawa.

“It would be quite a shock wave, a global financial shock wave, to have a government literally remove a central banker who, by all intents, seems to be doing a fine job — but is doing a very difficult job.”

Page had been asked what the effects could be if a Canadian government were to fire a central banker.

That comes as Conservative leadership candidate Pierre Poilievre has been leading a campaign of criticism centring on the Bank of Canada’s handling of rampant inflation, which sits at 6.7 per cent.

The domestic target is two per cent per year.

Read more:

Canada’s treasury ‘depleted’ as budget weans COVID spending, eyes uncertainty

As part of his criticism of the central bank, Poilievre has vowed that he would fire Tiff Macklem, governor of the Bank of Canada, if elected prime minister. That comment triggered rapid criticism over concerns it signalled an intent by the perceived leadership frontrunner to interfere with the bank.

Long-standing tradition is that the Bank of Canada operates independently of political decisions, with governors appointed on seven-year terms.

Officials have emphasized that those longer terms are what allows them to operate with a “measure of continuity over economic cycles — not electoral cycles — and allows for decision making that considers the long-term economic interests of Canadians.”

The Bank of Canada has opted to keep interest rates at rock-bottom during the COVID-19 pandemic, which is among the factors experts say have fuelled skyrocketing home prices. And as inflation keeps pushing the cost of living higher and higher, critics of the central bank like Poilievre have pointed the finger and argued its low rates are powering domestic inflation.

Canada, however, is far from alone.

Read more:

Conservative leadership hopefuls debate future of party, trade Netflix suggestions

Inflation is rampant around the world right now, with no clear end in sight.

High consumer spending amid the lifting of COVID-19 restrictions has combined with supply chain shocks worsened both by factory closures caused by the reality that the virus is still circulating in high numbers, as well as the sharp shortages in supplies caused by Russia’s invasion of Ukraine.


Click to play video: 'Bank of Canada forecasts nearly 6% average inflation outlook in 1st half of 2022'



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Bank of Canada forecasts nearly 6% average inflation outlook in 1st half of 2022


Bank of Canada forecasts nearly 6% average inflation outlook in 1st half of 2022 – Apr 25, 2022

“I think it’s a very simplification to assume that if we just change the leader, that somehow this sort of global environment — and inflation truly is a global issue — just somehow disappears,” Page said.

Sorenson asked: “Can the Bank or the Canadian government on their own bring inflation down in this country?”

Page said: “No.”

“This is a global phenomenon. A lot of it is supply-related, and it’s because of those very strong supports that went in 2020 to help during the lockdown,” he added.

“The economy’s come back really fast and eventually markets will adjust.”

So when might Canadians expect to see inflation back in a more normal range?

Page said the Bank of Canada’s moves to raise interest rates will play a role in helping slow the economy.

“I think over the next couple of years we could see inflation back maybe in that three per cent range.”


Click to play video: 'Sticker Shock: Coping with the rising cost of inflation in Canada'



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Sticker Shock: Coping with the rising cost of inflation in Canada


Sticker Shock: Coping with the rising cost of inflation in Canada

© 2022 Global News, a division of Corus Entertainment Inc.

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David Milgaard, who advocated for justice after he was wrongfully convicted of murder, has died

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David Milgaard, who was wrongfully convicted of murder and spent more than 23 years in prison, has died. Milgaard was only 17 when he was arrested for the rape and murder of Gail Miller in Saskatoon, Saskatchewan. He was released from prison in 1992 after DNA evidence proved his innocence. In 1999, Milgaard was awarded $10 million in a wrongful conviction lawsuit against the Canadian government. Milgaard and two friends had been on a road trip, driving through the city when the murder happened.

Milgaard, who was born in Winnipeg, had been living in Calgary with his son and daughter.

Milgaard maintained his innocence throughout his time in prison. His mother Joyce Milgaard, who died in 2020, tirelessly advocated on her son’s behalf. In the decades since his release, Milgaard had spoken publicly, calling for changes in how Canadian courts review convictions.

His picture is now included in the Canadian Journey’s gallery at the Canadian Museum for Human Rights. Isha Khan, the museum’s CEO, said Milgaard was a human rights defender.

“He is someone we know, and the reason we know is that he was able to tell his story, and it takes a special kind of person to continue to try to connect with people,” she said, adding his work is not over.

“There are people across this country in correctional institutions who have been wrongfully convicted, who need a voice and don’t have a voice that David Milgaard did for whatever reason it may be, and it is our job to listen and to look for those stories.”

Milgaard had recently been pushing for an independent review board to prevent miscarriages of justice.

“David was a marvellous advocate for the wrongly convicted, for all the years he’s been out since 1992. We’re going to miss him a lot. He was a lovely man,” James Lockyer, a Toronto-based lawyer, told CTV News Channel on Sunday.

Lockyer, a founding director of the Association in Defence of the Wrongly Convicted, joined Milgaard’s case following his release in 1992 and helped him through the process to get DNA testing done. Lockyer said as a result of the DNA evidence, a man named Larry Fisher was arrested, and charged with the rape and murder. Fisher died while serving a life sentence.

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Ontario international students, families making 'massive sacrifices' for the Canadian dream – CBC.ca

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The death of an Indian student in Toronto last month made international headlines, but while Kartik Vasudev’s story ended in tragedy, his parents’ sacrifices offer a glimpse into the hardships that many international students and their families face to achieve the dream of a future in Canada.

Vasudev’s father, Jitesh Vasudev, told CBC News he and his wife spent their entire life savings and mortgaged their house to take out a loan of $50,000, just to afford the first year of his son’s education in Canada, before he was shot and killed. 

“The only mistake of my innocent child was that he dreamt big of studying in a foreign country, and he wanted to make a name of himself while representing India,” said Vasudev’s mother, Pooja Vasudev, in a video posted to Instagram. “We had a lot of dreams and expectations with our child, he was going to be our support in our old age.”

International students who spoke to CBC News say those kinds of sacrifices are common, and can take a major toll. 

They say international students can pay almost four times more in tuition fees than domestic students, and are calling for change.

An Ontario Auditor General’s report from last year highlighted the reliance of Ontario colleges on international student tuition.

The report showed that while international students represented only 30 per cent of the total enrolment in public colleges, they accounted for 68 per cent of tuition fee revenue at a total of $1.7 billion. A majority of students — 62 per cent — were from India.

According to a 2020 report from Global Affairs Canada, international students contributed $16.2 billion and $19.7 billion to Canada’s GDP in 2017 and 2018.

A better future in Canada

Students and advocates told CBC News that many international students from India come to Canada to become permanent residents and build a better future for themselves as well as their families.

They say there are limited employment opportunities in India compared to Canada, leading their parents to go to great lengths to send them abroad.

Jobanpreet Singh knows that struggle firsthand.

Jobanpreet Singh, left, says his family spent all their savings, took out massive loans and also sold assets just to pay for his first year of college. (Submitted by Jobanpreet Singh)

“[Vasudev’s family] sacrificed a lot to send their child to Canada for a brighter future,” the 22-year-old international student said. “I can’t imagine how painful it must have been for them.”

Born and raised in a farmer’s family in Punjab, India, Singh came to Canada as an international student in August 2021, where he is studying at the Academy of Learning Career College in Toronto. 

For his first year in Canada, his family spent around $30,000 on his tuition and living expenses.

Singh said his family spent all their savings, took out massive loans and sold assets just to be able to pay for his first year of college.

“[International students] have work stress, school stress, and we have extremely high tuition fees, which is topped off with the fact that we can only work 20 hours a week,” he said.

Singh said it is very difficult to handle expenses and living costs in Toronto while working those limited hours.

According to a statement from Immigration, Refugees and Citizenship Canada (IRCC), “limiting off-campus work to 20 hours per week reflect the fact that the focus for international students in Canada is on their studies.”

Tuition gap between domestic and international students

Sarom Rho from advocacy group Migrant Students United says international students who come to Canada also face rising costs of tuition fees, which are already three to four times more than domestic tuition.

“The majority of current and former international students and their families have made massive sacrifices for them, for example by selling lands, taking out massive educational loans, selling assets, just to pay for these extremely high tuition fees,” said Rho.

Rho added that because of these financial burdens, international students also face significant mental health issues.

Ontario’s Ministry of Colleges and Universities said in a statement that it understands that as newcomers to Canada and Ontario, international students can face unique challenges. 

“Student wellbeing is paramount, and we support the steps taken by Ontario’s colleges and universities to ensure that international students are well supported before and after their arrival in Ontario,” said James Tinajero, spokesperson for the ministry.

Gurpreet Singh, a 22-year-old Seneca College student, came to Canada in September 2020. His parents mortgaged their entire agricultural farmland to send him to Canada.

Gurpreet Singh has completed half of his education and the remaining two semesters of his studies will cost him about $16,000. He says he is paying for the rest of his studies on his own. (Submitted by Gurpreet Singh)

He said because of his international student status in Canada, he can’t apply for scholarships and bursaries at his college.

“That’s a huge drawback for us,” said Gurpreet. “If we’re not getting anything extra [over] the domestic students and we pay the same taxes, then why do we pay this huge amount for our tuition?”

The ministry says college and university boards of governors have the full authority to set tuition fees for international students.

“Colleges and universities are allowed the discretion to establish tuition fees for international students at levels the institutions deem appropriate,” said Tinajero.

Gurpreet has completed half of his education, and the remaining two semesters of his studies will cost him about $16,000. But instead of asking for help from his family, Gurpreet is taking the responsibility on himself.

According to the IRCC, international students can work full-time when they are on a scheduled break, like during winter and summer holidays, or during a fall or spring reading week. 

Gurpreet is currently on a summer break from his college. He says this is his last chance to work full-time before he begins his third semester in the fall.

For the next four months of summer break, Gurpreet says he’ll be working in two different warehouses doing long days of general labour.

“Right now I’ve [got] to concentrate on my work to pay off my fees, so I’m willing to compromise for the next four months,” he said.

“I know this is going to be hard, but these hardships are temporary, and there’s light at the end of the tunnel.”

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