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New Layoffs Add to Worries Over U.S. Economic Slowdown

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The American economy is being buffeted by a fresh round of corporate layoffs, signaling new anxiety about the course of the coronavirus pandemic and uncertainty about further legislative relief.

Companies including Disney, the insurance giant Allstate and two major airlines announced plans to fire or furlough more than 60,000 workers in recent days, and more cuts are expected without a new federal aid package to stimulate the economy.

With the election a month away, an agreement has proved elusive. The White House and congressional Democrats held talks on Thursday before the House narrowly approved a $2.2 trillion proposal without any Republican support. It was little more than a symbolic vote: The measure will not become law without a bipartisan deal.

After business shutdowns in the early spring threw 22 million people out of work, the economy rebounded in May and June with the help of stimulus money and rock-bottom interest rates. But the loss of momentum since then, coupled with fears of a second wave of coronavirus cases this fall, has left many experts uneasy about the months ahead.

“The layoffs are an additional headwind in an already weak labor market,” said Rubeela Farooqi, chief U.S. economist for High Frequency Economics. “As long as the virus isn’t contained, this is going to be an ongoing phenomenon.”

The concern has grown as measures that helped the economy weather the initial contraction have wound down. The expiration of a $600-a-week federal supplement to unemployment benefits was followed by a 2.7 percent drop in personal income in August, the Commerce Department said Thursday.

In a separate report, the Labor Department said 787,000 people filed new applications for state jobless benefits last week. The total, not adjusted for seasonal variations, was a slight decline from the previous week, but continued to reflect the highest level of claims in decades.

The most recent layoffs are not included in that figure, nor will they be reflected in September data to be released by the department on Friday, the last monthly reading on the labor market before the election. The report is expected to show a continuing slowdown in hiring, with barely half of the spring’s job losses recovered, although there is more uncertainty than usual around the estimates.

“This doesn’t bode well for the economy,” said Gregory Daco, chief U.S. economist at Oxford Economics. “When you combine the layoffs with fiscal aid drying up, it points to very soft momentum in the final quarter of the year.”

Furloughs of more than 30,000 workers by United Airlines and American Airlines began Thursday after Congress was unable to come up with fresh aid for the industry, though the companies said they would reverse the cuts if Congress and the Trump administration reached an agreement. A $50 billion bailout in March obligated the carriers to hold off on job cuts through Oct. 1.

Credit…Eve Edelheit for The New York Times
Credit…Stephanie Keith for The New York Times

Allstate announced Wednesday that it would lay off about 3,800 employees to reduce costs. Those are about 8 percent of the roughly 46,000 employees Allstate had at the end of 2019.

Houghton Mifflin Harcourt, one of the country’s largest book publishers, said Thursday that it was cutting 22 percent of its work force, including 525 employees who were laid off and 166 who chose to retire. The company is a major supplier of educational books and materials, a business hit hard by school closings.

The Walt Disney Company said Tuesday that it would eliminate 28,000 jobs, mostly at theme parks in Florida and California. Many of the workers had been on furlough since the spring, but the company said it was making the cuts permanent because of “the continued uncertainty regarding the duration of the pandemic.”

Travel, entertainment, and leisure and hospitality employers have been among the hardest hit by the pandemic, and they continue to lag even as other areas of the economy have reopened. The American Hotel & Lodging Association, a trade group, said that without new stimulus legislation, 74 percent of hotels would lay off additional employees and two-thirds would be out of business in six months.

“We’re in a different phase of the recovery,” Mr. Daco of Oxford Economics said, and with demand for many companies’ services stuck below where it was before the pandemic, “businesses are left with no other choice but to reduce costs.”

Consumer spending on goods — whether for immediate consumption, like food, or used over a longer term, like appliances — now exceeds levels preceding the pandemic. But outlays for services, which account for roughly two-thirds of the nation’s economic activity, remain down about 8 percent.

The economic picture is not completely bleak. Personal spending was up 1 percent last month, and readings of consumer confidence have been gaining. Helped by low mortgage rates, the housing market is on a tear in much of the country, lifting employment in residential construction 2.1 percent from June to August, according to the Associated General Contractors of America.

But for many Americans, the easing of economic growth has meant an unexpected return to the ranks of the unemployed.

When the pandemic struck in March, Alex Stern was furloughed from his job as a publicist at a public relations firm in New York. He was called back in May after the agency, which works with companies in the food and beverage industry, received a loan through the federal Paycheck Protection Program.

Credit…Michelle V. Agins/The New York Times

But the company struggled to stay afloat, and Mr. Stern was permanently laid off on Tuesday.

To pay the November rent, he will have to borrow money from his parents, he said. He is considering moving back to his childhood home in Pennsylvania until he can find a new job.

“I don’t want to leave New York, and it’s hard because I’m almost 30 years old and I don’t know what I’m going to do next in life,” Mr. Stern said.

Among those affected by the Disney cutbacks is Taisha Perez, 29, who had worked part time as a drummer at the Animal Kingdom Theme Park at Walt Disney World in Orlando, Fla., for nearly three years.

The job gave her both a steady source of income and time to pursue her passion, television acting. “It’s honestly my favorite job that I’ve ever had,” Ms. Perez said. “I loved putting a smile on people’s faces.”

When she was furloughed in mid-March after the pandemic hit, she thought she would be out of work for just a few weeks. But on Tuesday, a text message from her union representative told her that her job would not be coming back.

“I was just in shock,” she said. “I couldn’t believe it.”

Ms. Perez said she could pay her rent and utilities on the roughly $250 a week she receives in state unemployment benefits, but could not afford any extra expenses, like the car she needs after hers broke down in March.

For those like Ms. Perez who lost work earlier in the year, the end of the $600 federal unemployment supplement has added to financial hardships.

Joann Taylor, a 45-year-old catering coordinator at a McAlister’s Deli franchise in Houston, used to work about 30 hours per week. But when the pandemic hit, her boss put her in an on-call position for deliveries only.

Credit…Todd Spoth for The New York Times

As a result, her hours were cut so severely — sometimes to two a week, or none at all — that she qualified for unemployment insurance, including $300 a week in Texas benefits before taxes.

But when the $600 weekly supplement expired at the end of July, Ms. Taylor began struggling to pay her monthly bills, including $1,240 in rent, $180 for electricity, a $240 car payment and $155 for auto insurance.

Determined to provide for her daughters, who are 6 and 14, she used the time while underemployed to get a license to sell life and health insurance. Now she’s looking for an agency to take her on, hoping for steadier income.

Until then, without further aid from Congress, Ms. Taylor is worried about paying the rent and buying groceries.

“I will have to go to every church around me and ask for help,” she said. “I will stand in food lines with the kids, because I cannot leave them at home. I will apply anywhere that I can for help, because there’s no way that I can allow us to be homeless.”

Reporting was contributed by Ben Casselman, Niraj Chokshi, Emily Cochrane, Alan Rappeport and Elizabeth A. Harris.

Source:- The New York Times

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Consortium of Indigenous chiefs seeking a way to participate in cannabis economy – Maple Ridge News

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Indigenous communities have been left out of the Canadian cannabis economy, and a group of Indigenous chiefs are out to change that for the good of their communities.

Chief Robert Gladstone of Shxwha:y First Nation says a consortium they’re calling “All Nations Chiefs” has worked for months to negotiate an agreement for on-reserve cannabis distribution directly with the province – but to no avail.

“It’s been two years since the rollout where they did not consult adequately with First Nations,” said Gladstone. “We are trying to find a way to participate in this new economy.”

To get there, they’ve organized an online forum with All Nations Chiefs from the communities of Shxwha:y, Cheam, Soowahlie and Sq’ewlets for the morning of Dec. 2. Organizers have invited Premier John Horgan, stakeholders, and the public to join them in the virtual dialogue on the cannabis question.

Gladstone described the recalcitrance from provincial counterparts as “another pathway out of poverty blocked” for First Nations communities across Canada, noting that only four per cent of Canadian cannabis licences are Indigenous-affiliated.

“That four per cent should be disturbing to everyone,” he said.

The group has also launched a petition that had almost 1,500 signatures by Nov. 27.

“We are asking Honourable Premier Horgan to take real action towards reconciliation and honour his government’s platform commitment to the UN Declaration of Indigenous Rights (UNDRIP) by allowing First Nations to participate in B.C.’s cannabis industry,” according to the petition preamble.

Since legalization, local First Nations leaders have been trying to control their own their destinies by finding a way to participate in the emerging economy “on a nation-to-nation basis,” the chief said.

Shxwha:y officials decided to go the route of applying for a Section 119 licence agreement under the Cannabis Control and Licensing Agreement Act, Chief Gladstone explained.

A Section 119 licence is required to legally distribute cannabis from retail stores on reserve land, and involve the province entering into agreements with individual First Nations, which supersede the Act. Only one community has signed such an agreement to date, the Williams Lake Indian Band. The Shxwha:y application used the Williams Lake vision as their model.

Some of the on-reserve cannabis stores in the area without provincial licensing have been operating in what government officials would describe as a grey area legally, while leaders are trying to negotiate a better way, with formal applications pending.

They started on-reserve stores under the inherent laws of their nation rather than under provincial licensing, some by enacting cannabis laws through land codes.

Those models differ from the route chosen by the owners of the first fully licensed cannabis store on reserve, which is The Kure on the Skwah reserve.

“The ultimate goal is to codify and harmonize the laws and regulations among all three levels of government,” Gladstone underlined.

But months later they are stymied, with no timeline, feedback or any response from the provincial government on their application. So they’re stepping up the pressure.

“We are reaching out. If they don’t answer, it’s a direct way of saying they are not interested in working toward a government-to-government relationship. There’s just no other way to interpret this.”

The online forum next Wednesday will focus on solutions to bring inclusivity and diversity to the nascent cannabis sector with First Nations involvement.

They feel they’ve put in the work to give the province a workable model.

“Now all we ask is recognition for our inherent right to trade and barter,” Gladstone said.

Chief Gladstone tells a story of how cannabis has changed everything in his village and beyond.

In total more than 100 people are working in the on-reserve stores around the Chilliwack area.

“These workers are not on CERB or social assistance,” Gladstone said.

As of a couple of years ago there were only four people working in Shxwha:y village. Now there are 13 jobs being held down currently at the store, and another 30 at the cultivation facility, where All Nations Cannabis Corp. is a Health Canada licensed cultivator and licensed producer applicant.

“It’s changed the standard of living for many in our village, going from abject poverty to a tier closer to the middle class,” Gladstone said. “So this is a success story.

“What we’re saying to the province is: ‘Don’t destroy this miracle of economic revival.’

“We’re just asking for co-operation.”

READ MORE: Cannabis stores rolling through the pandemic

READ MORE: Chilliwack has unique approach to cannabis retail

Do you have something to add to this story, or something else we should report on? Email:
jfeinberg@theprogress.com


@CHWKjourno
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Consortium of Indigenous chiefs seeking a way to participate in cannabis economy – North Delta Reporter

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Indigenous communities have been left out of the Canadian cannabis economy, and a group of Indigenous chiefs are out to change that for the good of their communities.

Chief Robert Gladstone of Shxwha:y First Nation says a consortium they’re calling “All Nations Chiefs” has worked for months to negotiate an agreement for on-reserve cannabis distribution directly with the province – but to no avail.

“It’s been two years since the rollout where they did not consult adequately with First Nations,” said Gladstone. “We are trying to find a way to participate in this new economy.”

To get there, they’ve organized an online forum with All Nations Chiefs from the communities of Shxwha:y, Cheam, Soowahlie and Sq’ewlets for the morning of Dec. 2. Organizers have invited Premier John Horgan, stakeholders, and the public to join them in the virtual dialogue on the cannabis question.

Gladstone described the recalcitrance from provincial counterparts as “another pathway out of poverty blocked” for First Nations communities across Canada, noting that only four per cent of Canadian cannabis licences are Indigenous-affiliated.

“That four per cent should be disturbing to everyone,” he said.

The group has also launched a petition that had almost 1,500 signatures by Nov. 27.

“We are asking Honourable Premier Horgan to take real action towards reconciliation and honour his government’s platform commitment to the UN Declaration of Indigenous Rights (UNDRIP) by allowing First Nations to participate in B.C.’s cannabis industry,” according to the petition preamble.

Since legalization, local First Nations leaders have been trying to control their own their destinies by finding a way to participate in the emerging economy “on a nation-to-nation basis,” the chief said.

Shxwha:y officials decided to go the route of applying for a Section 119 licence agreement under the Cannabis Control and Licensing Agreement Act, Chief Gladstone explained.

A Section 119 licence is required to legally distribute cannabis from retail stores on reserve land, and involve the province entering into agreements with individual First Nations, which supersede the Act. Only one community has signed such an agreement to date, the Williams Lake Indian Band. The Shxwha:y application used the Williams Lake vision as their model.

Some of the on-reserve cannabis stores in the area without provincial licensing have been operating in what government officials would describe as a grey area legally, while leaders are trying to negotiate a better way, with formal applications pending.

They started on-reserve stores under the inherent laws of their nation rather than under provincial licensing, some by enacting cannabis laws through land codes.

Those models differ from the route chosen by the owners of the first fully licensed cannabis store on reserve, which is The Kure on the Skwah reserve.

“The ultimate goal is to codify and harmonize the laws and regulations among all three levels of government,” Gladstone underlined.

But months later they are stymied, with no timeline, feedback or any response from the provincial government on their application. So they’re stepping up the pressure.

“We are reaching out. If they don’t answer, it’s a direct way of saying they are not interested in working toward a government-to-government relationship. There’s just no other way to interpret this.”

The online forum next Wednesday will focus on solutions to bring inclusivity and diversity to the nascent cannabis sector with First Nations involvement.

They feel they’ve put in the work to give the province a workable model.

“Now all we ask is recognition for our inherent right to trade and barter,” Gladstone said.

Chief Gladstone tells a story of how cannabis has changed everything in his village and beyond.

In total more than 100 people are working in the on-reserve stores around the Chilliwack area.

“These workers are not on CERB or social assistance,” Gladstone said.

As of a couple of years ago there were only four people working in Shxwha:y village. Now there are 13 jobs being held down currently at the store, and another 30 at the cultivation facility, where All Nations Cannabis Corp. is a Health Canada licensed cultivator and licensed producer applicant.

“It’s changed the standard of living for many in our village, going from abject poverty to a tier closer to the middle class,” Gladstone said. “So this is a success story.

“What we’re saying to the province is: ‘Don’t destroy this miracle of economic revival.’

“We’re just asking for co-operation.”

READ MORE: Cannabis stores rolling through the pandemic

READ MORE: Chilliwack has unique approach to cannabis retail

Do you have something to add to this story, or something else we should report on? Email:
jfeinberg@theprogress.com


@CHWKjourno
Like us on Facebook and follow us on Twitter.

Want to support local journalism during the pandemic? Make a donation here.

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Monday's fall economic statement will try to bridge current and future needs – iPolitics.ca

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The Liberal government is ready to table a fall economic statement that attempts to balance the current needs of the COVID-19 response with plans for Canada’s post-pandemic economy and social-safety net. 

On Monday, Finance Minister Chrystia Freeland will present her first fiscal and economic update since replacing Bill Morneau after the latter’s resignation in August. 

The statement will provide detailed fiscal projections for the years ahead, something the Liberals haven’t done since the pandemic began in the spring.

The Liberals will also present new measures to fight COVID-19, and lay the groundwork for longer-term and higher-cost priorities, such as national affordable child care, pharmacare, and fighting climate change — measures that interest labour, but concern business groups.

“I expect the government to be clear … that they remain committed to the priorities identified in the throne speech, and ensure that those things are going to be delivered on,” Hassan Yussuff, president of the Canadian Labour Congress, told iPolitics.

The throne speech included a long list of promises to green the economy and strengthen the country’s social safety net — efforts Yussuff says are vital, if Canada is to emerge from the pandemic stronger than before. 

The fiscal update coincides with a second wave of COVID cases, which have prompted new public-health restrictions that have shuttered businesses and rattled the confidence of consumers entering the holiday season. 

Levels of consumer confidence for November are now at their lowest since May, according to the Conference Board of Canada’s index.

Perrin Beatty, president and CEO of the Canadian Chamber of Commerce, said COVID will still be around for the foreseeable future, so Canada must have a plan to manage, rather than merely react to, the pandemic. 

“Unfortunately, up until now, the focus of governments has been: ‘Shut down and write a cheque,’ ” he told iPolitics.

Beatty said governments need to craft a more coherent strategy that better uses data and science to bring down infection rates, and allows Canadians to safely resume their lives soon as possible, while also ensuring resources get to the most vulnerable communities and economic sectors.

He said it’s wrong to think of a vaccine as a “silver bullet,” because it might not entirely eliminate the threat of COVID, and its distribution will take considerable time. The fiscal update should focus on current concerns, he said. 

READ MORE: Ford asks Trudeau for details of vaccine types, quantities, and timing

Speaking to reporters on Friday, Prime Minister Justin Trudeau said there are “very good chances” most Canadians will be vaccinated by September 2021.

He added that the fiscal update will include more support for Canadians during the pandemic, as well as plans to rebuild a “strong, resilient economy for everyone.”

Kevin Page said he expects the Liberals to punt some of their longer-term priorities to the next budget, while still presenting a comprehensive document.

“I think it will be more than a typical update; something probably looking like a mini-budget,” said Page, a former parliamentary budget officer and head of the University of Ottawa’s Institute of Fiscal Studies and Democracy.

The update should focus first on getting Canadians through the current crisis, said Elliot Hughes, a former policy adviser of Morneau’s.

“There’s going to be lots of time to sketch out those bigger things down the road,” he said. “What people want to know now is that the government’s got their backs.”

Hughes, now a senior advisor at Summa Strategies, cautioned that the government needs to keep its messaging “clean and straightforward,” but should be ready to answer questions about what to expect in the near future, as well in the recovery phase.

“It’s a tricky balance, but it’s one that you need to strike,” he said. 

READ MORE: Female, racialized and young Canadians less likely to benefit from jobs increase

The statement will also update the deficit, which is expected to be Canada’s largest since the Second World War. It’s also expected to be without a fiscal anchor to manage debt levels, though Freeland has previously said there’s no “blank cheque” for spending.

A report released by RBC on Friday forecasts the annual deficit to approach $370 billion, higher than the $343 billion projected in July. The report says spending announcements will add at least $90 billion to the 2021-22 deficit, and extensions to the wage subsidy and recovery benefit could add even more. 

Yussuff, who hopes the fall update will include money for infrastructure, child care and employment insurance, said now is not the time for fiscal restraint: Spending will both prevent an economic disaster and support women and people of colour, who’ve been disproportionately affected by the pandemic, he said.

“They’re going to need to be supported if we’re going to get to a full recovery.”

Beatty, who has supported Ottawa’s emergency spending thus far, said there should be a short-term child-care program to get mothers back into the workforce. But such spending must be targeted, and this is not the time for costly programs such as universal pharmacare, he said.

“Don’t get into programs that we can’t afford: permanent recurring programs that are simply going to build in a structural deficit.”

At what exact point Canada’s debt becomes a serious concern is being fiercely debated, Page said, but bond agencies might lower their credit ratings if Ottawa doesn’t re-introduce a fiscal anchor in the near future and the debt significantly increases.

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