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Economy added 31,000 jobs in October, unemployment rate hits pandemic-era low – CP24 Toronto's Breaking News

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Jordan Press, The Canadian Press


Published Friday, November 5, 2021 5:13AM EDT


Last Updated Friday, November 5, 2021 4:41PM EDT

OTTAWA – The Canadian economy churned out another month of job increases that brought the national unemployment rate to a pandemic-era low, even as economists warn that further gains could become increasingly difficult.

The addition of 31,000 jobs last month lowered the unemployment rate to 6.7 per cent, down from 6.9 per cent in September, for the measure’s fifth consecutive monthly decline.

Statistics Canada said the unemployment rate would have been 8.7 per cent in October, down from 8.9 per cent in September, had it included in calculations Canadians who wanted to work but didn’t search for a job.

RBC economists Nathan Janzen and Claire Fan wrote in an analysis that the unemployment rate is still above a longer-run rate of about six per cent, which suggests there are fewer than 200,000 available workers.

That makes filling the almost 900,000 current job vacancies a difficult prospect, said Leah Nord, senior director of workforce strategies for the Canadian Chamber of Commerce. It’s likely to prove much harder than the now-completed recovery of the three million jobs lost at the onset of the pandemic, she said.

“We just want to be done with this and it’s not going to be done,” she said.

“It’s not going to be done for a long time.”

Gains in October were seen across a number of industries, including in the hard-hit retail sector, that pushed the industry back to its pre-pandemic levels for the first time since March.

Offsetting some of the gains were losses in sectors like accommodation and food services that registered a second consecutive monthly decline. TD senior economist Sri Thanabalasingam suggested was that partly linked to renewed restrictions in Alberta. BMO chief economist Douglas Porter said the decline may also signal further hiring headwinds for bars and restaurants.

Statistics Canada reported that half the workers who lost jobs in the industry between August and October returned to the sector, with the remainder switching industries, roughly matching pre-pandemic trends.

Across the labour market, almost seven in 10 unemployed workers who returned to work within 12 months stayed in the same industry, again in line with pre-pandemic trends.

The data suggest no signs of a “great resignation” in Canada, said Behnoush Amery, senior economist with the Labour Market Information Council, but rather more sector-specific issues, particularly in high-contact service industries like accommodation and food services.

“It seems there’s a lot of job churn and adjustments happening in this sector for which we don’t have the full picture yet,” Amery said.

Average wages in the sector have been mostly flat, possibly because employers were watching what would happen to federal aid programs, said Brendon Bernard, senior economist with Indeed.

The federal government aid programs expired in late October, with business aid being narrowed to the hardest-hit firms.

Desjardins chief economist Jimmy Jean said the end of the Canada Recovery Benefit should bring more people into the job market, but cautioned the effects may not instantly appear because many workers have additional savings to rely upon.

“They have the luxury of taking their time to choose the job that they want, or that matches their skills the best,” he said in an interview. “It’s something that’s going to be drawn out, I think, over the next few months.”

The jobs report noted a decline in self-employment in October, but the statistics agency suggested some of those individuals moved to more permanent and in-demand jobs in the professional, scientific and technical services sector.

Kaylie Tiessen, an economist with Unifor, said indicators the union monitors to track precarious work show early signs of declines, such as the number of people working part-time who want full-time work, or those juggling multiple jobs.

If the trends hold, she said, it could further help job seekers.

“For the first time in a while workers are in the driver’s seat here and that means that we have more say over what we need in order to take a particular job,” Tiessen said.

Statistics Canada also said the ranks of Canada’s long-term unemployed, those who have been out of work for six months or more, was little changed in October at almost 380,000.

Mixing with headwinds created by COVID-19 are pre-pandemic issues that have only grown in the background, chief among them an aging workforce.

The number of people 65 and older has increased by 477,000 from October 2019, while the ranks of 15- to 24-year-olds dropped and the core working age population in between those two groups has shown little growth.

Statistics Canada said the demographic shift helped drive down the participation rate to 65.3 per cent in October, which is about 0.3 per cent below pre-pandemic levels.

The agency said the aging workforce could further strain the supply of workers and impede economic growth coming out of the pandemic.

This report by The Canadian Press was first published Nov. 5, 2021.

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Job growth in Canada exceeded expectations in November – Canada Immigration News

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Published on December 4th, 2021 at 08:00am EST

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With employment soaring beyond predictions and unemployment dropping to near pre-pandemic levels, new labour force data suggest that Canada is on its way to a full economic recovery.

This past November, Canadian employers added 154,000 jobs to the economy. Last month’s growth exceeded analysts’ predictions of 38,000, which was closer to October levels. The gains pushed employment a full percentage point higher than pre-pandemic levels. Also, unemployment dropped to 6%, which is within 0.3 percentage points of what it was in February 2020.

Data from Statistics Canada’s Labour Force Survey reflect labour market conditions during the week of November 7 to 13. Proof-of-vaccination policies and other public health measures were largely similar to those in October.

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Labour shortages persist despite employment gains

Hiring in November was driven by the private sector both in full-time and part-time positions. Even so, Canada is still experiencing labour shortages across sectors like hospitality, retail, and health care. In September, there were roughly one million job vacancies across the country.

Most government COVID-19 financial assistance measures ended in late October. Some analysts say it may have pushed people to accept job offers. Among these measures was the Canadian Recovery Benefit for individuals, which had been accused of discouraging people from returning to work. The Conference Board of Canada says the lack of wage growth was an even greater disincentive, especially in low-wage service industries.

“November’s job growth suggests the withdrawal of the [Canadian Recovery Benefit] may have pushed some workers back into employment though alone this will not be sufficient to address the significant labour shortages affecting several industries,” writes economist Liam Daly.

RBC economist Nathan Janzen wrote that despite the surge in employment there were still “exceptionally low” levels of workers in the service sectors.

“Employment in accommodation & food services edged up 5k from October but is still more than 200k below pre-shock levels,” Janzen wrote. “Travel and hospitality spending has been rebounding, but with the unemployment rate now substantially lower, it is increasingly clear that there are not enough remaining unemployed workers out there to re-fill all of those jobs any time soon.”

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Bitcoin plunges overnight – CTV News

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Bitcoin prices plummeted overnight to a low of about US$43,000.

As of 10:30 am EST Saturday, the cryptocurrency had dropped more than 13 per cent in the previous 24 hours, from US$56,294 to US$48,309 — a loss of almost US$8,000.

That’s a stark contrast from its all-time high of just last month, when Bitcoin reached almost US$69,000 on November 9.

It’s a slight rebound from a plunge of more than 17 per cent earlier in the day.

Ether, the second most popular cyrptocurrency, fell almost 10 per cent.

The drop for bitcoin follows a volatile week for financial markets. Global equities and benchmark U.S. bond yields tumbled on Friday after data showed US job growth slowed in November and the Omicron variant of the coronavirus kept investors on edge.

Data from another platform, Coinglass, showed that nearly US$1 billion worth of cryptocurrencies had been liquidated over the past 24 hours, with the bulk being on digital exchange Bitfinex.

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Will psychedelics become mainstream? This Calgary company is betting on it – CBC.ca

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Danny Motyka discovered his love for chemistry when he was high on LSD back in the mid-2000s. The single tab of blotter acid — emblazoned with images of tongues from the rock band Kiss — set him on a path to push psychedelics out of the shadows.

Now 31, Motyka is the CEO of Psygen, a Calgary business hoping to manufacture synthetic psychedelics for the pharmaceutical industry. While the application of hallucinogens in medicine is in its infancy and remains highly speculative, Motyka and his company of believers are encouraged by renewed interest in the field.

“There’s a huge market opportunity here,” Motyka said. 

A spate of early scientific research — along with big injections of cash from wealthy and celebrity investors — has triggered a renaissance of sorts for psychedelics, which for decades were pushed underground by the war on drugs. 

Companies want to be the next psychedelic unicorn

Dozens of companies have emerged in recent years, seeking to get in on the ground floor of a fledgling industry they bet will take them higher. Some, like Germany-based Atai Life Sciences and the U.K.’s Compass Pathways, have become unicorns — not some kind of hallucination, but the type of startups worth more than $1 billion.  

Danny Motyka, left, and Peter van der Heyden are co-founders of the Calgary startup Psygen, which has ambitions to supply the pharmaceutical industry with psychedelics like psilocybin and MDMA. (Reid Southwick/CBC)

“We’re really breaking ground here in that psychedelic chemistry has been illegal, and now we’re able to do it in a legal context,” said Peter van der Heyden, Psygen’s co-founder and chief science officer. 

“It’s never been done before.”

Potential for a new industry

Magic mushrooms, LSD and other psychedelics are hallucinogenic drugs that remain illegal to possess for recreational use. But some regulators such as Health Canada have allowed for research into them as possible treatments for mental health conditions, sending companies and investors on a trip to a new industry.

While the sector initially attracted an early rush of investor enthusiasm, some of the euphoria has already begun to fade as shareholders come to grips with the long and uncertain road ahead.

Researchers are still running clinical trials looking into whether substances like psilocybin, the active ingredient in magic mushrooms, can effectively and safely treat depression, or whether MDMA, often found in ecstasy or molly, can help patients with post-traumatic stress disorder.

“We have to go through the entire drug approval pathway and demonstrate safety and demonstrate efficacy,” van der Heyden said. “So it’s too early, really, to say we know that these things work.”

Production expected early 2022

Psygen’s lab, currently under construction, would initially manufacture psychedelics for research and clinical trials, though it still needs Health Canada approval. The company hopes those trials lead to the creation of new therapeutic drugs, allowing its lab to expand to commercial-scale production of medical-grade substances.

They’ve asked Health Canada for a dealer’s license, which gives special permission to handle and produce controlled drugs that are otherwise illegal to possess. The designation comes with a strict set of rules, including security measures to prevent theft, proper record keeping and reporting.

Van der Heyden, left, and Motyka stand inside the construction site of the firm’s psychedelics manufacturing facility, expected to be operational by March 2022. (Reid Southwick/CBC)

For now, company officials are optimistic the first phase of the project will secure the green light from federal regulators and they can start producing psychedelics by the end of March 2022.

By then, the facility would be capable of producing 12 to 15 kilograms of synthetic psilocybin a year, enough to fill demand from clinical research, Motyka said.

Marijuana paves the way for mushrooms

The Alberta business has applied to handle eight different psychedelic drugs, though its CEO said psilocybin is the substance most in demand from drug development companies, likely because of loosening cannabis laws.

“That’s reflective of this liberalization of plant medicines. It’s easy to go from cannabis as a medicine to mushrooms as a medicine,” Motyka said. “It’s a bit harder to make that next jump to LSD, especially with the amount of stigma that’s associated.”

Researchers are looking at psilocybin’s potential to treat various conditions, from anxiety and obsessive-compulsive disorder, to problematic substance use. Health Canada, which has approved three clinical trials testing the drug in treatment of depression, said psilocybin has so far shown some promise in some cases, but further research is needed.

“Clinical trials are the most appropriate and effective way to advance research with unapproved drugs such as psilocybin,” the regulator said in a statement.

“Clinical trials ensure that the best interests of patients are protected and that a product is administered in accordance with national and international ethical, medical and scientific standards.”

‘Hungry for something new’

Industry observers say the legalization of cannabis for recreational or strictly medical purposes in many parts of the world has helped to ease stigmas and convince investors to pump hundreds of millions of dollars into psychedelics.

Plus, the outbreak of the deadly COVID-19 virus — and the rounds of restrictions that came with it — triggered a fresh wave of mental health concerns. And it’s happening at a time when people are interested in unconventional ways of looking at problems, said Leila Rafi, a Toronto lawyer with clients in the industry.

Leila Rafi, a Toronto lawyer, says a fresh wave of mental health concerns emerging from the coronavirus pandemic has helped to bring renewed focus to psychedelics as possible medicines. (Leila Rafi)

“There’s a lot of investors out there who are willing to put a little bit of money into this industry and see what happens — and even take a bit of a hit,” said Rafi, a partner in McMillan’s capital markets group.

“And I think investors are just hungry for something new.”

Psychedelic stocks in a lull

Steve Hawkins, the CEO of financial services company Horizons ETFs, runs a fund that allows people to invest in the broader psychedelics market. The exchange traded fund (ETF) tracks a couple dozen publicly traded companies that are heavily involved in, or have significant exposure to, the industry.

So far, it’s individual investors, rather than big pension funds, that have parked money in the fund, Hawkins said.

“This is still a very early stage investment proposition.”

An initial burst of investor excitement has given way to a lull in recent months, with share prices for drug development firms plunging. The Horizons psychedelics ETF has lost half of its value on the stock market since hitting a peak in February. 

In an industry where companies are not making money, stock prices are driven by other developments, including news of breakthroughs in research. But there haven’t been enough intoxicating incentives to lure investors back, Hawkins said, noting that while share prices have fallen from their peaks, they are still above where they were in 2020.

Investors hooked on psychedelic ventures also face plenty of risk.

“All investors who are investing in early stage drug development companies need to be prepared to lose a substantial amount of money– Eric Foster, Dentons lawyer

Firms that are attracting troves of investment dollars are often burning through all that cash researching drugs that may not materialize, Hawkins said. “These are very risky companies.”

Some could fail, similar to what happened in the cannabis industry

“All investors who are investing in early stage drug development companies need to be prepared to lose a substantial amount of money,” said Eric Foster, a partner at Dentons law firm who helps investment banks finance psychedelic ventures.

“The (potential) upside is that they will be able to take a candidate all the way through the regulatory approval process, and effectively get to a drug that’s been approved … Then, all of a sudden, it’s going to be worth significantly more.”

A new frontier

The very idea that psychedelics could emerge from the shadows of a decades-long drug war and pave the way to a new frontier of medicine has inspired other investors with deep pockets.

Liam Payne, pictured here performing in Jeddah, Saudi Arabia in 2019, is among a growing list of celebrity investors betting on psychedelics. (Khalid Alhaj/The Associated Press)

Liam Payne, the British One Direction singer, along with PayPal co-founder and billionaire Peter Theil are on the growing list of celebrity investors. New York Mets owner Steven Cohen, Shark Tank’s Kevin O’Leary and Tim Ferriss, the podcaster and author of The 4-Hour Workweek, are also on the roster.

Then there’s Sa’ad Shah. Convinced that researchers are only scratching the surface of psychedelics’ potential power to reshape mental healthcare, he co-founded a venture capital player focused on the industry. 

Sa’ad Shah, co-founder of a psychedelics venture capital fund, says the industry is ‘a bit of the Wild West. (Sa’ad Shah)

Shah has been raising money from friends, various CEOs and ultra-high-networth investors to build a warchest to unleash on dozens of companies. The Noetic Fund, based in Toronto, raised $32 million US in its first round and invested it into 22 ventures, including Calgary’s Psygen. Now, it’s on the hunt for another $200 million.

Nearly halfway there, Shah said he’s not facing the same kind of investor burnout that has sent stock prices tumbling. He said most of the “crown jewels” in the industry remain privately held companies that continue to raise funds.

“It’s a burgeoning industry,” Shah said. “It’s an incredibly exciting industry. It is a bit of the Wild West.”

An opportunity and a business venture

Van der Heyden, Psygen’s co-founder, says he found a gap in this Wild West landscape when he spoke with researchers who couldn’t get their hands on pharmaceutical-grade psychedelics for their studies. He saw an opportunity. 

A child of the hippie era of the 1960s and early 1970s, he said the counterculture movement exposed him to drugs like LSD. But it wasn’t until his retirement that psychedelics became a possible business venture. 

And it’s made for some unusual conversations.  

“I might be sitting at the barber and he asks me, ‘What do you do?’ And so I say, ‘Hey, guess what? We make psychedelic drugs.'”

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