Although, the government’s top priorities
include job creation, economic growth and long term prosperity, yet the bitter
things like trade deficit, the manufacturers’ interests to outsource, and the economic
recessionary periods are among the woes that can’t be ignored.
Last November’s gain of 21,600 new job
opportunities was ridiculous, because the rosy picture turned into a gloomy one
just a month later. The ‘December disappointment’ sent many people home.
Loss of 45,900 Canadian jobs cannot be taken
lightly, as the unemployment rate jumped to 7.2% from
6.9% just in one month. This alone declared the year 2013 as the weakest
one since 2009.
No doubt, the research through Statistics
Canada pages shows a fluctuation in the numbers of job losses and gains during
the months in question. However, the numbers are bouncing back and forth in the
negative or positive territory depending upon various factors.
In November, there was a surprising improvement
in manufacturing sector, but loss of jobs occurred in goods producing
industries. In December, there was a decline in construction work, agriculture,
forestry, service producing sectors-educational services, accommodation and
food services.
For the month, Ontario and Alberta led the provinces lower with losses of 39,000
and 12,000 respectively. British Columbia added 13,000 jobs and Newfoundland
and Labrador gained 1,900.
By industry, there were 19,000 fewer jobs in
educational services, while the other services category, which includes
personal care as well as civic and social organizations, lost 15,000. The
agriculture sector lost 9,800 and natural resources lost 8,000.
Health
care
and social assistance were the only
areas to experience gains in December
as the sector added 22,000 jobs.
Looking from provincial perspective, Alberta recorded the fastest, year over
year employment growth with a 3.3 per cent surge and steady gains throughout
the year.
The weakness was mostly seen in full-time
employment, which dropped 60,000 with a 14,200 increase in part-time
employment.
The private employment lost 26,300, while the
self-employed lost 37,900.
But, the public employment rose by 18,200.
Based on the trend, the negative growth is likely
to be more than reversed in the months ahead back to November rate of 6.9%.
Paul
Ferley,
Assistant Chief Economist, RBC
Economics said, “Our expectation of a near-term reversal of the December
employment drop is more consistent with the Bank of Canada just maintaining the
current highly stimulative monetary conditions. Our forecast assumes that the
overnight rate will be maintained at 1.00% into the second quarter of 2015.”
Whereas, BMO
Capital Markets chief economist Doug
Porter said, “the ‘dismal jobs data’
will add pressure on the loonie and stoke chatter about the possibility of an
interest rate cut by the Bank of Canada.” He suggested, “It will likely take more than
one month of disappointing job growth to trigger a rate cut.” "We continue
to believe the bank will need to see an extended period of economic
underperformance and even lower inflation before they would even consider
easing."
On
the other hand, Bank of Canada (BoC)
governor Stephen Poloz has suggested
that the central bank's next policy move is just as likely to be a cut in interest rates as a hike.
By the way: Statistics Canada reported earlier this week that Canada's trade deficit edged higher in November as imports inched
up and exports stalled.
In
fact, Canadian ‘markets and job’ data is weaker than expected, so is that of
the United States which happens to be Canada’s biggest trading partner. The
U.S. added only 74,000 jobs in December after averaging 214,000 in the previous
four months.
Canada’s
Industry Minister James Moore admitted the jobs report was disappointing. He
said, "I think if you step back and look at the overall jobs picture, we
still have the strongest job record in all the G7." He claims, "The
overall picture for the Canadian economy is still very strong.
Furthermore, low,
stable and predictable inflation is the basis for a well-functioning economy
allowing Canadians to spend and invest with confidence. This means a good
monetary policy attracts healthy economy.
Good thing is the
BoC plays a vital role cautiously in reversing the negative economic condition
to maintain economic balance by offering good stimulative monetary conditions.
When demand is
strong, the BoC raises interest rates to cool off the overheated economy.
But, when demand
is weak, inflationary pressures are likely to ease. In that case, the bank goes
for rate cuts to stimulate the economy. Thus, economics is when demand exceeds the
supply, so prices will rise. The bank is here to implement what is necessary to maintain
the balance.
As, the
stubborn economic hardship is a cause of concern for everyone; appropriate
steps must be taken to reverse the looming economic uncertainty to avoid any
threat of tough time ahead.
Apart from the
actions of BoC, the Canada’s Economic Action Plan (EAP) offers the tools and
resources in the form of apprenticeship grants, training programs and the
effective job search techniques to all those who qualify. For smarter
Canadians, there is a message for struggle to make their livelihood a success
story through utilizing the available EAP.