Canadian workers are fast becoming hot commodities in a tight labor market and companies are increasingly forced to raise wages to fill jobs – and retain existing staff – a factor likely to complicate the Bank of Canada‘s efforts to tame inflation.
While fast rising wages have yet to filter through to official data, hiring intentions are far above pre-pandemic levels and staffing companies say it is a “sellers market” for skilled and unskilled job seekers across many industries.
Economists say wage growth could turn into a big problem for the Bank of Canada, which is already grappling with inflation that is near a two-decade high. On Wednesday the central bank surprised the market https://www.reuters.com/world/americas/bank-canada-signals-it-could-hike-rates-sooner-than-expected-2021-10-27 with its hawkish tone, nudging forward the chance of an interest rate hike as it warned inflation would go higher.
“I’m seeing increases in labor wage rates anywhere from 10% to 40%,” said Tanya Cerniuk, head of sales for Canada at global staffing firm Adecco Group.
“I saw one today … they were offering C$14 ($11.35) an hour and now they’re offering C$19.50 per hour,” she said. “Things are changing so quickly. Employers are having to be very agile.”
Digital marketing professional Riley Haas started looking for a new job in August and signed on with an internet marketing company within weeks, earning about 30% more than before, plus benefits.
“I was blown away by the number of opportunities that were out there, as well as some of the remuneration being offered,” Haas said. “I have never had a job-hunting experience like this in my life.”
While Canada’s employment has returned to pre-pandemic levels, wage growth was up 1.7% on the year in September, compared with 4.3% in February 2020, right before the onset of the pandemic, according to Statistics Canada.
“If you look at the various wage measures, they’re actually still somewhat below their pre-pandemic levels,” Bank of Canada Governor Tiff Macklem said on Wednesday.
The central bank is watching closely for signs of wage inflation as the headline Consumer Price Index is now expected to be above the 1%-3% control range until late 2022, he added.
MORE MONEY, MORE WORKERS
Some companies, hesitant to boost base wages amid ongoing pandemic-related uncertainty, are instead offering rich signing bonuses and hourly premiums based on attendance and retention, Adecco’s Cerniuk said, all of which may not register as wage increases.
Loosening of COVID-19 restrictions has prompted an early start to seasonal hiring for the holidays, pitting retailers and restaurants against manufacturers and warehousing firms to secure workers. Lower immigration during the pandemic has added to the pinch.
“I think it’s a perfect storm,” Cerniuk said.
A giant billboard outside an Ottawa liquor store offers seasonal jobs starting about 15% above minimum wage, which is C$14.35 an hour in the province of Ontario, while a placard in a nearby Whole Foods store promises hires a C$2-C$3 per hour bonus plus richer overtime if they stay on for the entire holiday season.
Derek Holt, head of capital market economics at Scotiabank, pointed to seasonally adjusted and annualized numbers that show a sharp three-month acceleration in wage growth, calling it hard to ignore.
“Wage growth is ripping in Canada,” he said in a recent note, adding that it is just the latest pressure point on the central bank.
Meloche Group, an aerospace components maker in the Montreal area, has boosted worker salaries this month and is planning another wage hike in February. The company has about 30 open positions – 10% of its workforce – and the staff shortage is making it difficult to complete deliveries on time, Chief Executive Officer Hugue Meloche said.
“We are expecting a lot of growth,” he told Reuters on the sidelines of the Aero Montreal global supply-chain summit this week. “We have to get prepared.”
(Reporting by Julie Gordon in Ottawa, additional reporting by Allison Lampert in Montreal and Fergal Smith in Toronto; Editing by Paul Simao)
Ocean Economy: The Next Wave of Sustainable Innovation – Visual Capitalist
Exploring the Digital Asset Ecosystem
The digital asset sector has undergone a rapid expansion over the past couple of years, growing in value and functionality.
Beyond the price growth of popular cryptocurrencies, digital assets are powering innovative applications that enable value transfer beyond just payments. From tokens that grant dividend-like revenue to holders, to tokens backed by other digital and physical assets, the digital asset ecosystem is redefining asset and financial structures before our very eyes.
The Functions and Types of Digital Assets
Digital assets can be broken down into three different types of assets that fulfill three primary functions. The first two functions of digital assets, store of value and medium of exchange, are well established functions of digital and traditional assets.
However, a third functionality of being able to pass through values to holders has emerged, with benefits like discounted application fees, governance voting rights, and monetary rewards passed onto token holders.
These functions are fulfilled by three main types of digital assets:
- Currency: tokens that are a unit of account and medium of exchange
- Asset-backed tokens: tokens backed by hard assets like equity, debt, or physical assets
- Pass through tokens: tokens that grant revenues, rewards, and network benefits to holders
Many know of Bitcoin, the founding cryptocurrency that functions as a digital currency today. Along with this, tokens whose value is backed by other assets like Arca Lab’s ArCoin (Ticker: RCOIN) are also straightforward in nature and functionality.
Pass through tokens are where digital assets explore innovative concepts and structures unique to the blockchain networks that underpin the assets.
For example, cryptocurrency exchange FTX issued an exchange token (FTT) at launch, which provides holders with reduced trading fees on the platform. FTT holders can also stake, or lock up, their tokens to receive increased referral rebates, more votes in FTX polls, and more airdrop rewards (tokens exclusively given out to holders or stakers of another token).
Classifying Governance and Decentralization
Along with token types and their functionality, it’s important to understand the governing bodies and governance structures behind digital assets.
The governing body is the entity that issues and controls the function of a digital asset, ultimately defining the purpose and proposed value of a digital asset. These range from centralized governments and organizations, like the government of the Bahamas (issuer of the CBDC, the Bahamian Sand Dollar) to Decentralized Autonomous Organizations and blockchain protocols like Ethereum (ETH) and Solana (SOL).
|Governing Body||Governance Structure|
|Decentralized Autonomous Organizations (DAOs)||Decentralized|
|Protocols, Platforms, and Dapps||Typically decentralized|
Governance structures define the framework and procedures which decide and implement changes for a digital asset. These changes can be about anything, like the digital asset’s tokenomics, pass through values, or future development goals.
While some governing bodies like governments and organizations have centralized governance structures, centralization and decentralization isn’t all or nothing and can be seen as more of a spectrum.
Certain DAOs or protocols might have a core team of developers that propose certain features, which are then voted on and ultimately decided by the holders of the digital asset.
The Future of Traditional Assets in a Digital Framework
With an established taxonomy of digital assets, we can start to map out how traditional assets fit into this framework.
From tokenizing real estate and commodities for easier digital exchange and settlement to equity-like tokens issued by companies that provide holders with voting rights or non-financial rewards, digital assets will reshape the traditional asset structures of today.
By providing unbound and transparent asset structures, digital assets are providing people around the world with more freedom in storing, transferring, and accruing value.
Go to Ar.ca to learn more about digital assets today.
'Miracle on Saint-Laurent Street': Quebec economy sees country's strongest post-pandemic rebound – The Globe and Mail
Quebec’s economy is poised to outperform every other Canadian jurisdiction this year in a remarkable rebound from the pandemic that has put the province on track to record its highest annual GDP growth on record.
The provincial government will spend some of its windfall on cost-of-living bonuses and training programs to help fight the labour shortage and inflation that plagues the province, Finance Minister Eric Girard said during a press conference announcing his fall fiscal update on Thursday.
But the surprisingly strong revenues will also allow Quebec to continue reducing its deficit and debt burden as it continues to close the persistent wealth gap with Ontario that Premier François Legault has made a fixation.
After economic activity declined by 5.5 per cent in 2020, it is expected to bounce back by 6.5 per cent this year, leaving the province richer than before the pandemic, according to government projections. That is much faster growth than the 4.2 per cent expected and slashes $5.4-billion from the projected provincial deficit.
“The economic performance of Quebec in 2021 was exceptional,” Mr. Girard said.
Analysts largely agree with the Finance Minister’s rosy assessment. In a recent research paper titled Miracle on Saint-Laurent Street, Bank of Nova Scotia economist Marc Desormeaux observed that growth of 6.5 per cent would be an “all-time record” for Quebec. It would also outpace Ontario and Canada as a whole, a rare distinction for a province that has traditionally lagged the rest of the country in GDP growth.
Quebec’s rocketing fortunes were fuelled in part by the timing of public-health measures, which the Legault government rapidly eased in the summer of 2020 after the pandemic’s first wave that led to a “staggering” 80-per-cent rise in household consumption in the third quarter of that year, Mr. Desormeaux said. Generous federal and provincial aid also injected life into the economy.
But Quebec’s boom times precede the recent recovery, the bank report points out, with large increases in full-time jobs and wages between 2017 and 2019, along with a household saving rate before the pandemic that was significantly higher than in the rest of Canada. Those strong fundamentals have helped the province emerge from the COVID-19 crisis in good shape, Mr. Desormeaux said.
“There’s a whole lot of momentum in Quebec’s economy.”
In his fall update, Mr. Girard acknowledged anxieties about the twin afflictions of inflation and labour shortages facing much of the Canadian economy. To help Quebeckers with a rising cost of living, he announced single lump-sum payments for low- and middle-income households, amounting to $400 for couples and $275 for people who live alone.
The province will also spend $2.9-billion over five years “to combat the labour shortage” by paying for the training, requalification and recruitment of as many as 170,000 workers, with a focus on the health, education, and engineering and IT sectors.
Despite new spending, strong economic growth allowed Quebec to revise its deficit and debt projections downward. This year’s budget deficit is now pegged at $6.8-billion, fully $5.4-billion less than expected. The province will also be able to reduce its gross debt level faster than anticipated, from 46.8 per cent of GDP in March of this year to an expected 44.3 per cent next March. The acceleration “can be explained by the strength of the economic recovery,” according to the economic and fiscal summary.
The raft of good news has allowed Quebec to play catch-up in its quest to close the wealth gap with Ontario, a goal the Legault government has repeatedly emphasized in its three years in power. Between 2017 and this year, the gap shrunk from 16.4 to 12.9 per cent. On Thursday, the government stated its ambition of eliminating Ontario’s wealth advantage altogether by 2036.
Asked whether that was an excessively long timeline, Mr. Girard pointed out how persistently Quebec has trailed its richer neighbour. “Fifteen years to close a wealth gap that’s been there for almost 100 years, I think that’s realistic,” he said.
Despite the province’s strong showing, some critics charge that it is misspending its unexpected revenue bump. The Conseil du patronat du Québec, a business group, said the work force measures don’t go far enough and that it was surprised by the lack of immediate help finding employees, calling this the “most serious labour shortage in [Quebec’s] recent history.”
While praising the government for continuing on its path to cutting the deficit, Maria Lily Shaw, an economist with the conservative Montreal Economic Institute, said she would have preferred the government to balance the budget sooner.
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