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Economy

Innovation experts say COVID-19 exposing vulnerabilities of Canada’s economy – Globalnews.ca

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The COVID-19 crisis is exposing the shortcomings of Canada’s economy, particularly when it comes to supply chains and the development of value-added products that would keep the country competitive, innovation experts say.

Dan Breznitz, the co-director of the innovation policy lab at the University of Toronto, said he expects global trade in raw commodities to decline as the novel coronavirus makes it more difficult to move people and goods around the world.

It’s a wake-up call for Canada’s resource-based industries, he said, noting Canada “will have a problem just selling wood and unprocessed oil.”


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The country must rebuild its capacity to produce sophisticated goods through innovation in those sectors and beyond, said Breznitz, who is also the chair of innovation studies at the Munk School of Global Affairs.

“We no longer can actually produce the basic things we need in order to survive under (a) pandemic, and we cannot count on global production networks to do that in times of crisis.”

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Alan Winter, British Columbia’s former innovation commissioner, agrees, saying COVID-19 has further exposed Canada’s dependence on purchasing goods and technology offshore with profits from primary resource industries.






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“The issues that we see today around (personal protection equipment) and getting stuff out of China is all illustrative of the fact that our economy, to some extent, has been totally submerged into other countries in terms of supply chains,” he said.

“Our strategy of selling raw natural resources doesn’t make a lot of sense. We need to have the capability of developing more finished goods ourselves.”

Canada lags behind other members of the Organization for Economic Co-operation and Development for investing in research and development on new products and technology, said Winter.


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In his final report to the B.C. government, released last week, Winter pointed out that about 1.4 per cent of the province’s GDP goes towards research and development, while the OECD average is about 2.4 per cent. Several of Canada’s competitors make investments in the 3.5 per cent range, he added.

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Breznitz said Canada lacks policies aimed at creating more small- and medium-sized enterprises and then helping them grow, particularly when it comes to access to capital in the early stages before investments from venture capitalists.

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“Right now in Canada, it will be almost impossible to get the finance, just the basic finance for you to be able to scale up,” he said, using an example of a family owned, medium-sized business with an idea for a new product or technology.

Canadian entrepreneurs also face regulatory red tape in selling newly developed products in Canada, said Breznitz.






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“It expensive and each province has its own little quirks. So, it’s actually easier to sell to the whole United States.”

He said the federal government should provide targeted grants and loans directly to entrepreneurs and companies, rather than funnel money into more innovation “superclusters,” accelerators and incubators.

The “silver lining” is that Canada’s workforce is much more sophisticated than it was 15 years ago, with the proven potential for innovative ideas, Breznitz said.

Others are commercializing those ideas, said Breznitz, pointing to large multinationals that have ramped up operations in Canada including Facebook and Google.


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“The question is what kind of policies would allow more Canadian entrepreneurs, small businesses and big businesses, old and new, to do exactly what the multinationals are doing.”

Private companies operating in Canada have also failed to invest in research and development because innovation is costly and risky, he said.

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“You can make easy money with less risk by being less sophisticated.”

The need for economic support and opportunities is even more pronounced in rural communities, where Breznitz said the lack of investment has been “catastrophic.”

Ken Coates, Canada Research Chair in Regional Innovation, said many residents lack access to a reliable internet connection, let alone access to start-up capital and training opportunities in science and technology.






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“We should be delivering basic services at a national level to all Canadians. And we’re not even close to there right now.”

The pandemic may mobilize rural residents to demand the same essential service standards available in urban areas, said Coates, who also teaches at the graduate school of public policy at the University of Saskatchewan.

He said Canada’s natural resources have made the country rich and complacent.

The irony is that much of Canada’s resource development happens in and around rural and remote communities that should have become prosperous as a result, Coates said.

Economic development in rural and remote areas should capitalize on local strengths, he said.

For example, the capital of Sweden’s northernmost county was well-suited to become the host of Facebook’s European data servers. The city of Lulea has cheap and abundant hydro electricity and cold temperatures for the hot servers, much like parts of B.C., said Coates.

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But it takes a lot of nerve, enthusiasm, commitment and support for a rural or remote community to decide to stand up and fight for new jobs, investors and residents, he said.

“There’s no easy solution whatsoever.”

© 2020 The Canadian Press

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Economy

Seniors having big impact on local economy – Quinte News

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With June being Seniors’ Month, Quinte News is looking at the impact that those 65 and over have on our community and more specifically, on local businesses.

Close to 20% of the Quinte Region’s population falls into the senior category, with the area’s cost of living, natural amenities and sometimes slower pace to life, being attractive qualities for the area to have.

But it’s not just seniors relocating here that’s making a difference for the local economy.

Bay of Quinte Regional Marketing Board Executive Director Dug Stevenson says, there are plenty of older people who find our area attractive as a place to visit and spend some cash.

“One of the things that’s interesting is when you consider seniors’ spending”, he says.

“Of course they’re on a fixed income, but they have fewer things they need to pay for as well. They probably don’t have a mortgage anymore, the kids are probably gone and they’re not worried about paying for things like education, so they’ve probably got a bit more set aside for that leisure spending”.

Stevenson says from a travel and tourism perspective, the seniors group is actually more comparable to Millennials, who range between the ages of 22 and 38.

“A lot of them have no strings attached. They have a fixed income, but have money set aside and they know what they want to do and go do it.”, he says.

Quinte West Chamber of Commerce CEO Suzanne Andrews says seniors who live in the area have a strong impact on the economy, but not just as consumers of goods.

“They access a lot of services” she says. “Things like health services, some of which are privately owned businesses, or they go to hairdressers and restaurants. So definitely they are a huge economic factor when looking at the local economy and consumer spending in our region”.

Andrews also noted that while many seniors do move to our area to retire, not all of them want to get out of work completely, which adds to the local workforce.

“We are finding here in the Quinte Region especially, seniors are choosing to continue to work, maybe not at a full time level, but are available to work and look for positions that fit their experience and knowledge”, she says. “That’s definitely something for employers to think about”.

Morgan Foran of Meta Employment services backed that up saying they’re seeing a jump in the number of seniors looking for work as well.
“We’ve seen an increase in the last couple of years in indivuduals who either don’t want to retire, or have been in a long term position and the company is closed, but there are a lot of seasoned workers for sure that are still actively looking.
She says the modern job market can be challenging to navigate and there are some things they need to help more mature workers with.
“I think it’s just the ever changing technology” she says. “When it comes to the actual job, I think they have the expertise to do the job themselves, but it’s more the way things have changed with applying for positions and things being done online and the ways you have to apply”.
“How to look for work is how we’re helping right now”.
Meta’s Sandra Leslie added those senior workers are actually making a big difference in improving the local workforce.
“There are benefits to having seniors in the workforce”, she says, “They bring such a wealth of knowledge and experience to the position and often they act as a mentor to the younger or newer staff. That’s really important. To have those multiple generations in the workforce and the workplace, so that you have that diversity to support all of your customers and to share that knowledge”.
Meanwhile Cassandra Bonn,  a marketing Specialist with 25 years experience at ad agencies, large and small, and now employed with Quinte Broadcasting, says business owners would be wrong to ignore marketing to today’s seniors.
“Most seniors are no longer frail and dependent but instead are very active with many living in their own homes into their 90’s and continuing to work and play golf, ski, garden, and travel.   Many have more disposable income then they ever had.  Seniors are active and consistent contributors to our economy.”
When asked which media are best to reach seniors Bonn admitted a bias working at Quinte Broadcasting but says her experience shows that a combination of radio and digital marketing works best for business.
“Locally there are many great radio options, including the area’s first radio station, CJBQ-800-am, who’s programming is geared to the 55 + cohort and dominates the demographic.  Social media, such as Facebook, is also vital to a marketing strategy because more and more seniors are very active online.

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Economy

Unemployment rate hits new record even as economy adds jobs – CP24 Toronto's Breaking News

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Jordan Press, The Canadian Press


Published Friday, June 5, 2020 5:18AM EDT


Last Updated Friday, June 5, 2020 3:25PM EDT

OTTAWA – Canada’s employment minister says the federal government is rethinking a key COVID-19 benefit so workers have more incentive to get back on the job, in an effort to maintain a surprising boost in job numbers from May.

Statistics Canada reported that the country got back 289,600 jobs in May – which mirrored a similar bump in the U.S. – after three million jobs were lost over March and April and about 2.5 million more people had their hours slashed.

Provincially, Quebec led the way, gaining 231,000 jobs as it became one of the first provinces to ease restrictions, doing so just before Statistics Canada collected data the week of May 10. Ontario was the only province with losses, albeit at a slower pace than in March and April.

Combined with more people reporting getting regular hours, the agency said Canada had recovered only 10.6 per cent of employment losses and absences related to the COVID-19 pandemic.

Friday’s jobs report showed the unemployment rate in May rose to 13.7 per cent, the highest level in more than four decades of comparable data. But that’s because more people started looking for work – meaning the rate shouldn’t be taken as a sign of underlying weakness, said CIBC senior economist Royce Mendes.

The unemployment rate is a measure of the people looking for work who can’t find it, meaning it can actually decline if job-seekers give up, or increase as formerly discouraged seekers see new signs of hope.

Still, the monthly labour force survey showed that men gained back more jobs than women, resulting in a wider gender gap in employment losses as a result of COVID-19, and that the pandemic continued to disproportionately affect lower-wage workers.

To keep gains going, business and labour groups called for a revamp of the Canada Emergency Response Benefit and the employment insurance system.

The first cohort of recipients of the $500-a-week payment will max out their 16 weeks of benefits in early July. Some may qualify for employment insurance, while others may not have any work available, meaning significant drops in income that could hamper the path to recovery, said TD senior economist Brian DePratto.

The Canadian Labour Congress and Canadian Chamber of Commerce separately called for reforms to the decades-old EI system, which the Liberals determined early on in the crisis couldn’t handle the influx of jobless claims.

Employment Minister Carla Qualtrough suggested all ideas are on the table when it comes to EI, and the future of the CERB.

“As we look into the months coming … we’ve got a different goal in mind: People need to get back to work safely,” she said at a midday press conference.

“So our thinking moving forward is how do we balance a need to continue to support workers, while not disincentivizing work?”

The most recent federal figures show 8.37 million people applied for the CERB, with $43.18 billion in payments as of June 2. Qualtrough said 1.2 million recipients no longer require it, although it wasn’t immediately clear why.

The Canada Revenue Agency also said this week that almost 190,000 payments of wrongfully received benefits had been made as of June 3.

Economists had been watching the CERB numbers as a proxy for Friday’s jobs report, which set up expectations for another round of job losses.

CERB figures will continued to be watched to track possible job losses and compare it to areas where there are signs of progress, said Brendon Bernard, an economist at the Indeed Hiring Lab.

“The strength of this rebound is going to depend to a significant degree on what happens with layoffs,” he said in an interview. “We could see some areas of the economy bounce-back as shuttered sectors reopen, but if layoffs continue, then it’s going to be tough for net job gains to be particularly strong.”

The total number of unemployed Canadians doubled from February to April, a surge driven by temporary layoffs that the vast majority of workers expected to last less than six months.

At the same time, there was a spike in the number of people who wanted to work but weren’t actively looking for jobs, likely because the economic shutdown has limited job opportunities. People not actively seeking work aren’t counted in unemployment figures.

The unemployment rate for May would have been 19.6 per cent had the report counted among the unemployed those who stopped looking for work – largely unchanged since April.

Statistics Canada said lower-wage workers recovered just over one-10th of the losses they experienced in March and April. But they continued to be a higher share of people working less than half of their usual hours.

Lower-wage workers were among the first- and hardest-hit during the shutdown, largely because they worked in industries like retail, restaurants and hotels that closed early in the pandemic.

Besides seeing less improvement generally compared with men, women with children under age six saw slower job gains than those with older children.

Rebounds were also weak for students and recent immigrants.

This report by The Canadian Press was first published June 5, 2020.

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Economy

Saskatchewan says economy is rebounding despite 12.5% unemployment rate – Globalnews.ca

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The Saskatchewan government is feeling confident its economy is on the rebound.

This comes despite the unemployment rate being 12.5 per cent at the end of May, according to Statistics Canada’s latest Labour Force Survey released Friday.

By the end of April, the unemployment rate in the province was 11.3 per cent. Saskatchewan’s unemployment rate is, however, the second-lowest among provinces and below the national average of 13.7 per cent.


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“The Saskatchewan workforce is still being seriously affected by the COVID-19 pandemic but there are a number of signs that show Saskatchewan’s economy is both recovering faster, and was less impacted, than other provinces,” said Jeremy Harrison, immigration and career training minister, in a statement.

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“We have the second-lowest unemployment rate in Canada and the number of people working rose in May, which is a strong, positive sign in the COVID-19 era.  The Saskatchewan economy is positioned to strongly improve as we move forward with the Re-Open Saskatchewan plan.”

In Saskatchewan, there were 600 more jobs in May than April, while 87 per cent of those working in February were working in May.


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Since February, the number of hours worked in the province has dropped by 9.1 per cent. It’s the second-lowest decline in provinces. Nationally, the average decline in the number of hours worked over that same period is 19.3 per cent.






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“Looking forward, we are seeing positive economic news in Saskatchewan, including announcements about helium and lithium recently,” Harrison said.

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“These new investments will bring jobs and investment to communities across the province and will help lift our economy out of the current challenges facing markets globally.”


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The province said businesses in Saskatchewan are faring better than other jurisdictions, claiming to have closed fewer than other provinces did.

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“This speaks to the strength of Saskatchewan’s economy and a strong reopening plan aiding in economic recovery,” the province said in a release issued on Friday.

Despite the optimism from the provincial government, the Saskatchewan NDP has laid out three actions it believes the province should take right now to strengthen the economy going forward.

First, to put Saskatchewan businesses and workers first through a Sask-first procurement plan that helps keep jobs in the province. Secondly, make the Saskatchewan Small Business Emergency program more accessible.






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Finally, to end the six-month lockout between Regina’s Co-op Refinery and its workers, which would put 800 Saskatchewan people back to work.

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“New Democrats have urged Premier Moe and this Sask. Party government to protect jobs and small businesses, but clearly not enough has been done,” Opposition Leader Ryan Meili said.

“We know that Saskatchewan’s economy was already shrinking before COVID – and now the Premier’s lack of action to put Saskatchewan workers and businesses first is making things worse.”

Saskatchewan continues its reopen plan with Phase 3 beginning on June 8.

© 2020 Global News, a division of Corus Entertainment Inc.

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