US economy adds 661,000 jobs in September as recovery slows - Al Jazeera English | Canada News Media
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US economy adds 661,000 jobs in September as recovery slows – Al Jazeera English

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The United States economy added 661,000 jobs in September – fewer than many economists were expecting – while the unemployment rate fell to 7.9 percent, the US Department of Labor reported on Friday.

This is the final monthly snapshot of the US labour market American voters will see before the November 3 presidential election, and the unemployment rate falls at a time of rising uncertainty around the pace of the economic recovery and President Donald Trump’s re-election bid after he and First Lady Melania Trump tested positive for COVID-19.

September marks the fifth straight month of job gains since the economy haemorrhaged more than 22 million of them in March and April as coronavirus lockdowns swept the nation. More than 11.4 million of those positions have been clawed back. But the labour market is still well shy of its pre-pandemic strength.

Back in February, the unemployment rate was hovering near a half-century low at 3.5 percent.

Though job creation is moving in the right direction, it is not moving fast enough for millions of laid-off Americans, many of whom have already faced or are facing permanent job losses.

Tuesday’s debate between US President Donald Trump and Democratic presidential nominee Joe Biden offered nothing in the way of thoughtful discourse on how to get unemployed Americans back to work.

Trump is advocating the same policy mix he used prior to the pandemic to nurse the economy back to health: tax cuts, regulatory rollbacks and a continuation of his administration’s “America First” crackdown on trade deals and trading partners Washington regards as unfair.

Biden’s “Build Back Better” blueprint aims to revive the US economy from the ravages of COVID-19 while redressing long-festering inequalities and the climate crisis. His policy mix includes increasing corporate taxes to fund innovation and buy American products to expand jobs; tax incentives and penalties to encourage US firms to keep and create jobs in the US; a massive $2 trillion investment in clean energy and a federal boost for caregiving.

Multiple gauges of economic activity released this week signal that the recovery is starting to plateau. Layoffs remain widespread, activity at the nation’s factory is downshifting, household incomes fell more than expected in August and consumer spending – the engine of the US economy accounting for some two-thirds of growth – has also slowed sharply.

The entire fall in household incomes is due to the expiration of the federal $600 weekly top to state unemployment benefits at the end of July.

The White House and Congress remain at loggerheads over a new round of virus relief aid and many economists, including US Federal Reserve officials, have warned the economic recovery is at risk of stalling or even derailing without more federal fiscal support from Washington.

Deeper dive into September numbers

A deeper dive into the jobs report shows that the number of unemployed workers stood at 12.6 million in September, one million fewer than the previous month, but almost twice as high as February when 6.8 million Americas were unemployed.

The number of people on temporary layoff fell by 1.5 million last month to 4.6 million – dramatically lower than 18.1 million recorded in April when tens of millions of Americans were thrown out of work during lockdowns.

But the number of permanent job losses rose by 345,000 in September to 3.8 million.

While the nation’s unemployment rate fell to 7.9 percent last month, not all of that recovery was due to positive reasons.

To be counted as “unemployed”, a person needs to be actively looking for work. But in September, about 4.5 million Americans said they were prevented from looking for work because of the pandemic.

Of the 19.4 million Americans who reported that they were unable to work last months because of a pandemic-related closure or lost business, only about 10.3 percent received at least some pay from their employer.

Recovery and inequalities

Prior to the pandemic, the nation’s jobs market was on fire and the racial unemployment gap had narrowed to its lowest on record.

But the ravages of COVID-19 are now exacerbating pre-existing inequalities.

Though September marked the first time in five months that the racial employment gap narrowed, there is a still a considerable gap.

The unemployment rate for whites last month was 7 percent, compared with 12.1 percent for African Americans and 10.3 percent for Latinos.

The jobless rate for men above 20 years stood at 6.5 percent in September compared with 6.9 percent for women.

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Telus prioritizing ‘most important customers,’ avoiding ‘unprofitable’ offers: CFO

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Telus Corp. says it is avoiding offering “unprofitable” discounts as fierce competition in the Canadian telecommunications sector shows no sign of slowing down.

The company said Friday it had fewer net new customers during its third quarter compared with the same time last year, as it copes with increasingly “aggressive marketing and promotional pricing” that is prompting more customers to switch providers.

Telus said it added 347,000 net new customers, down around 14.5 per cent compared with last year. The figure includes 130,000 mobile phone subscribers and 34,000 internet customers, down 30,000 and 3,000, respectively, year-over-year.

The company reported its mobile phone churn rate — a metric measuring subscribers who cancelled their services — was 1.09 per cent in the third quarter, up from 1.03 per cent in the third quarter of 2023. That included a postpaid mobile phone churn rate of 0.90 per cent in its latest quarter.

Telus said its focus is on customer retention through its “industry-leading service and network quality, along with successful promotions and bundled offerings.”

“The customers we have are the most important customers we can get,” said chief financial officer Doug French in an interview.

“We’ve, again, just continued to focus on what matters most to our customers, from a product and customer service perspective, while not loading unprofitable customers.”

Meanwhile, Telus reported its net income attributable to common shares more than doubled during its third quarter.

The telecommunications company said it earned $280 million, up 105.9 per cent from the same three-month period in 2023. Earnings per diluted share for the quarter ended Sept. 30 was 19 cents compared with nine cents a year earlier.

It reported adjusted net income was $413 million, up 10.7 per cent year-over-year from $373 million in the same quarter last year. Operating revenue and other income for the quarter was $5.1 billion, up 1.8 per cent from the previous year.

Mobile phone average revenue per user was $58.85 in the third quarter, a decrease of $2.09 or 3.4 per cent from a year ago. Telus said the drop was attributable to customers signing up for base rate plans with lower prices, along with a decline in overage and roaming revenues.

It said customers are increasingly adopting unlimited data and Canada-U.S. plans which provide higher and more stable ARPU on a monthly basis.

“In a tough operating environment and relative to peers, we view Q3 results that were in line to slightly better than forecast as the best of the bunch,” said RBC analyst Drew McReynolds in a note.

Scotiabank analyst Maher Yaghi added that “the telecom industry in Canada remains very challenging for all players, however, Telus has been able to face these pressures” and still deliver growth.

The Big 3 telecom providers — which also include Rogers Communications Inc. and BCE Inc. — have frequently stressed that the market has grown more competitive in recent years, especially after the closing of Quebecor Inc.’s purchase of Freedom Mobile in April 2023.

Hailed as a fourth national carrier, Quebecor has invested in enhancements to Freedom’s network while offering more affordable plans as part of a set of commitments it was mandated by Ottawa to agree to.

The cost of telephone services in September was down eight per cent compared with a year earlier, according to Statistics Canada’s most recent inflation report last month.

“I think competition has been and continues to be, I’d say, quite intense in Canada, and we’ve obviously had to just manage our business the way we see fit,” said French.

Asked how long that environment could last, he said that’s out of Telus’ hands.

“What I can control, though, is how we go to market and how we lead with our products,” he said.

“I think the conditions within the market will have to adjust accordingly over time. We’ve continued to focus on digitization, continued to bring our cost structure down to compete, irrespective of the price and the current market conditions.”

Still, Canada’s telecom regulator continues to warn providers about customers facing more charges on their cellphone and internet bills.

On Tuesday, CRTC vice-president of consumer, analytics and strategy Scott Hutton called on providers to ensure they clearly inform their customers of charges such as early cancellation fees.

That followed statements from the regulator in recent weeks cautioning against rising international roaming fees and “surprise” price increases being found on their bills.

Hutton said the CRTC plans to launch public consultations in the coming weeks that will focus “on ensuring that information is clear and consistent, making it easier to compare offers and switch services or providers.”

“The CRTC is concerned with recent trends, which suggest that Canadians may not be benefiting from the full protections of our codes,” he said.

“We will continue to monitor developments and will take further action if our codes are not being followed.”

French said any initiative to boost transparency is a step in the right direction.

“I can’t say we are perfect across the board, but what I can say is we are absolutely taking it under consideration and trying to be the best at communicating with our customers,” he said.

“I think everyone looking in the mirror would say there’s room for improvement.”

This report by The Canadian Press was first published Nov. 8, 2024.

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TC Energy cuts cost estimate for Southeast Gateway pipeline project in Mexico

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CALGARY – TC Energy Corp. has lowered the estimated cost of its Southeast Gateway pipeline project in Mexico.

It says it now expects the project to cost between US$3.9 billion and US$4.1 billion compared with its original estimate of US$4.5 billion.

The change came as the company reported a third-quarter profit attributable to common shareholders of C$1.46 billion or $1.40 per share compared with a loss of C$197 million or 19 cents per share in the same quarter last year.

Revenue for the quarter ended Sept. 30 totalled C$4.08 billion, up from C$3.94 billion in the third quarter of 2023.

TC Energy says its comparable earnings for its latest quarter amounted to C$1.03 per share compared with C$1.00 per share a year earlier.

The average analyst estimate had been for a profit of 95 cents per share, according to LSEG Data & Analytics.

This report by The Canadian Press was first published Nov. 7, 2024.

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BCE reports Q3 loss on asset impairment charge, cuts revenue guidance

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BCE Inc. reported a loss in its latest quarter as it recorded $2.11 billion in asset impairment charges, mainly related to Bell Media’s TV and radio properties.

The company says its net loss attributable to common shareholders amounted to $1.24 billion or $1.36 per share for the quarter ended Sept. 30 compared with a profit of $640 million or 70 cents per share a year earlier.

On an adjusted basis, BCE says it earned 75 cents per share in its latest quarter compared with an adjusted profit of 81 cents per share in the same quarter last year.

“Bell’s results for the third quarter demonstrate that we are disciplined in our pursuit of profitable growth in an intensely competitive environment,” BCE chief executive Mirko Bibic said in a statement.

“Our focus this quarter, and throughout 2024, has been to attract higher-margin subscribers and reduce costs to help offset short-term revenue impacts from sustained competitive pricing pressures, slow economic growth and a media advertising market that is in transition.”

Operating revenue for the quarter totalled $5.97 billion, down from $6.08 billion in its third quarter of 2023.

BCE also said it now expects its revenue for 2024 to fall about 1.5 per cent compared with earlier guidance for an increase of zero to four per cent.

The company says the change comes as it faces lower-than-anticipated wireless product revenue and sustained pressure on wireless prices.

BCE added 33,111 net postpaid mobile phone subscribers, down 76.8 per cent from the same period last year, which was the company’s second-best performance on the metric since 2010.

It says the drop was driven by higher customer churn — a measure of subscribers who cancelled their service — amid greater competitive activity and promotional offer intensity. BCE’s monthly churn rate for the category was 1.28 per cent, up from 1.1 per cent during its previous third quarter.

The company also saw 11.6 per cent fewer gross subscriber activations “due to more targeted promotional offers and mobile device discounting compared to last year.”

Bell’s wireless mobile phone average revenue per user was $58.26, down 3.4 per cent from $60.28 in the third quarter of the prior year.

This report by The Canadian Press was first published Nov. 7, 2024.

Companies in this story: (TSX:BCE)

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