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Canada posts massive jobs gain; employment back to pre-pandemic levels

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The Canadian economy posted a monster jobs gain in September, pushing employment back to its pre-pandemic levels, and the jobless rate hit an 18-month low, Statistics Canada data indicated on Friday.

Analysts said the figures showed the recovery from the COVID-19 pandemic was gaining pace but predicted the Bank of Canada would want to see sustained evidence of strength before adopting a more aggressive stance on the timing of interest rate hikes.

Statistics Canada reported a net gain of 157,100 new jobs, all of them in full-time employment. The jobless rate dipped to 6.9%, the lowest level since February 2020.

Analysts polled by Reuters had forecast the country would add 65,000 new jobs in September and its unemployment rate would fall to 6.9% from 7.1% in August.

Canada has now returned to the employment levels seen before the COVID-19 pandemic started last year, having regained the 3 million jobs it lost during the crisis, Statscan said.

“It’s very solid and shows that Canada is doing well in that fourth wave,” said Jimmy Jean, chief economist at Desjardins Group, saying the central bank might announce later in October that it is further tapering its quantitative easing program.

All the job gains came in full-time employment, which posted an increase of 193,600 new jobs, and were split evenly between the public and private sectors. The economy shed 36,500 part-time positions.

The Bank of Canada slashed interest rates to a record low of 0.25% last year and says it will not consider raising them again until the economy has absorbed excess slack, which it expects to occur in the second half of 2022.

Due to population growth, there are still 276,000 more people unemployed than there were in February 2020.

“The Bank of Canada is still going to want to see more improvement from here because their goal isn’t just to get back to the pre-pandemic jobs number, it (is) to get back to the pre-pandemic employment population ratio,” said Andrew Kelvin, chief Canada strategist at TD Securities.

The Canadian dollar touched its strongest level since Aug. 11 at 1.2490 per greenback, or 80.06 U.S. cents, up as much as 0.5% on the day. Separately, data showed U.S. employment increased far less than expected in September.

Royce Mendes, senior economist at CIBC Capital Markets, noted that while the number of hours worked were up 1.1%, they remained 1.5% below their pre-pandemic level.

“While the headline print likely seals the deal for another taper from the Bank of Canada later this month, there’s still a ways to go to fully heal the labor market,” he said in a note.

(Additional reporting by Steve Scherer in Ottawa and Fergal Smith and Maiya Keidan in Toronto;Editing by Alison Williams, Chizu Nomiyama and Paul Simao)

Economy

Top economists call for radical redirection of the economy to put Health for All at the centre in the run-up to G20 – World Health Organization

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The COVID-19 Pandemic has brought into focus the stark reality of the large and growing inequities across the globe in access to health care and health products: for every 100 people in high-income countries, 133 doses of COVID-19 vaccine have been administered,
while in low-income countries, only 4 doses per 100 people have been administered.

Yet, to date, the world continues to follow the same economic paradigm that doesn’t change the underlying finance structure and applies outdated thinking on economic development, which stands in the way of Health For All. As the G20 Summit approaches
in Rome from 29-31 October, where, first, health and finance ministers, and then heads of state and government, come together, there is a window of opportunity for a radical redirection from health for the economy to the economy for health for all.
The critical challenge is both to increase the magnitude of the finance available for health and to govern it in a more directed and effective manner. 

The World Health Organization (WHO) Council on the Economics of Health For All (WHO Council on the Economics of Health For All) calls now, more than ever, for clear, ambitious goals to mobilize and focus investments towards health, considering financing for health as a long-term investment and not
a short-term cost. The Council’s new brief on Financing Health for All prioritizes two key dimensions: more finance and better finance and lays out the way forward through three pathways to action:

  1. Creating fiscal space by easing artificial constraints imposed by outdated economic assumptions and reversing the harmful effects of reforms that lead to big health cuts, allowing spending and investments towards Health For All to
    increase significantly;
  2. Directing investments to ensure Health for All becomes the central purpose of economic activities, and increase public leadership and dynamic state capabilities to create a conducive regulatory, tax, industrial policy and investment
    environment; and
  3. Governing public and private finance by regulating the functioning and financing of private health markets through measures that crowd in and direct private finance towards improving health outcomes globally and equitably.

The Council believes that a new paradigm must be pursued that avoids macroeconomic policies and assumptions that move us away from Health For All. This means designing policies to reach health for all now and in the long-term and realigning finance from
all sectors and sources through conditionalities that fuel symbiotic gains in the public interest. Not only more financing of the health sector, but better-quality finance is crucial to deliver Health For All, which must be equitable and ensure a
sustainable impact on peoples’ lives.

The challenge is to change mindsets within countries that impose internal constraints on spending and to transform externally-imposed conditionalities that hinder spending on what matters for health and promote Health For All. Changing the rules of the
game is a fundamental priority of any strategy to deliver Health For All, and policymakers have the ability to rethink finance now.

“The COVID-19 pandemic has demonstrated that the financing of health systems needs to change radically to protect and promote the health of all people,” said Dr Tedros Adhanom Ghebreyesus, Director-General of WHO. “The latest report
by the Council on the Economics of Health For All makes a clear and compelling argument for the need for sustained financing to be directed to achieving health for all people, and for investments to be understood as long-term gains for national and
global development.”

“While health systems are under-resourced, more finance is not the only solution. The work of the Council stresses the need to reform and redirect finance in radical ways so that the objective is Health For All is designed into the financial structures,
the conditionalities and the partnerships between business and the state,” said Professor Mariana Mazzucato, Chair of the Council.

By way of background, the WHO Council on the Economics of Health For All was established in November 2020 by WHO Director-General Dr Tedros Adhanom Ghebreyesus. The Council’s core mission is to rethink how value in health and wellbeing
is measured, produced, and distributed across the economy. It will recommend a new way to shape the economy with the objective of building healthy societies that are just, inclusive, equitable, and sustainable. Made up of ten of the world’s
most eminent economists and health experts, the Council works on four areas on how to rethink measurement of economic development, financing, capacity, and innovation with the aim of achieving Health for All. Briefs in each of these areas, and a comprehensive
final report to be produced in 2023, will be used to build momentum amongst finance ministers, heads of state/government, as well as other decision makers such as other financial authorities and international development authorities, towards changing
the structure of economic activity in favor of Health For All.

The members of the Council are Professor Mariana Mazzucato (Chair), Professor Senait Fisseha, Professor Jayati Ghosh, Vanessa Huang, Professor Stephanie Kelton, Professor Ilona Kickbusch, Zelia Maria Profeta da Luz, Kate Raworth, Dr Vera Songwe and Dame
Marilyn Waring (see bottom of page: WHO Council on the Economics of Health For All).

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Economy

Swiss National Bank Warns of Risks With Green Economy Push – Bloomberg

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Actively pushing for a green transformation of the economy could undermine the effectiveness of the Swiss National Bank’s monetary policy, Governing Board Member Andrea Maechler said. 

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Business

UBS logs surprise 9% rise in Q3 net profit

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UBS posted a 9% rise in third-quarter net profit on Tuesday, as continued trading helped the world’s largest wealth manager to its best quarterly profit since 2015.

Its third-quarter net profit of $2.279 billion far outpaced a median estimate of $1.596 billion from a poll of 23 analysts compiled by Switzerland’s largest bank.

“Our business momentum, our focus on fueling growth, on disciplined execution and on delivering our full ecosystem to clients – all of this led to another strong quarter across all of our business divisions and regions,” Chief Executive Ralph Hamers said in a statement.

In each of the last four quarters, UBS saw double-digit percent gains in net profit as buoyant markets helped it generate higher earnings off of managing money for the rich.

From July through September, favourable market conditions, and higher lending and trading amongst its wealthy clientele, unexpectedly helped raise earnings over the bumper levels reported in the third quarter of last year.

 

(Reporting by Oliver Hirt and Brenna Hughes Neghaiwi; Editing by Michael Shields and Edwina Gibbs)

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