• Employment & Unemployment,  Research,  Wages

    Interrogating the Labour Shortage Hypothesis

    Canada’s Senate is investigating temporary migrant labour programs in Canada, which have expanded rapidly in the last two years, and their impact on labour markets and other issues. The Centre for Future Work’s Jim Stanford was invited to provide testimony on the issue of whether a purported “labour shortage” necessitates increased temporary migration inflows to Canada. Here is an annotated transcript of his testimony.

  • Commentary,  Employment & Unemployment,  Inflation,  Macroeconomics

    Inflation Accelerates in July Despite Higher Unemployment

    Statistics Canada reported this week that consumer price inflation in Canada accelerated modestly in July, with the headline year-over-year rate rising to 3.3% (from 2.8% in June). In this commentary, Centre for Future Work Director Jim Stanford argues this adds to growing evidence that there’s no reliable correlation between inflation and unemployment. The commentary originally appeared at rabble.ca.

  • Employment & Unemployment,  Inequality,  Macroeconomics,  Research

    The Failures of ‘Trickle-Down’ Economics in Alberta

    Since its election in 2019, the current provincial government in Alberta has emphasized a classic ‘trickle-down’ economic strategy. It argues that by boosting profits of private business, capital investment will grow, and job-creation, rising incomes, and economic growth will then ‘trickle down’ to the rest of the population.

  • Commentary,  Employment & Unemployment,  Macroeconomics,  Wages

    The False Doctrine of the ‘Labour Shortage’

    A common argument that Canada faces a severe ‘labour shortage’ is being invoked to justify regressive policies in many areas: including higher interest rates, record-high (but exploitive) immigration programs, and pushing back the normal retirement age. In this column, originally published in the Toronto Star, Centre for Future Work Director Jim Stanford shows that Canada has not ‘run out’ of workers. Forcibly creating a cushion of surplus labour (through policies to compel labour supply or restrict labour demand) will make life easier for corporate HR managers. But they will undermine the life changes of millions. Humans are not Widgets, and we aren’t in ‘Short Supply’ By Jim Stanford Busy people…

  • Commentary,  Employment & Unemployment,  Macroeconomics

    Is the Economy “Hot”? Or is it Cold, and Getting Colder?

    The Bank of Canada is widely expected to increase its policy interest rate again this week, for the eighth time in the last 10 months. Media and financial market commentary on its decision has made numerous throwaway references to how Canada’s economy is still “running hot,” and that i why a rate hike is needed.  This common claim is surprising, and not consistent with economic evidence. Canada’s economy is not “running hot” by any concrete measure. Here are six: Final domestic demand in Canada has been weakening for over a year, and was shrinking in the third quarter of 2022 (latest data). Were it not for the export sector (with…

  • Commentary,  Employment & Unemployment,  Macroeconomics

    Economic Outlook for 2023: Soft Landing or Hard Impact?

    In this year-in-review column, originally published in the Toronto Star, Centre for Future Work Director Jim Stanford reflects on the turbulent economic events of 2022 – dominated by the rise of global inflation, and a dramatic shift in monetary policy in Canada and many other countries. The outlook for 2023, unfortunately, will likely be determined by the side-effects of that harsh monetary policy medicine. Workers are Being Sacrificed to a Doctrine that Intentionally Keeps Unemployment High by Jim Stanford Economic events during 2022 were dominated by the rise of global inflation, surging to the fastest pace in decades. Economists had thought this spectre was long dead and buried, after years…

  • Commentary,  Employment & Unemployment,  Macroeconomics

    Latest Interest Rate Hike Increases Risk of Recession

    On December 7, the Bank of Canada increased its policy interest rate for the seventh time since March, by another super-sized increment of 50 basis points (0.50%). The rate is now set at 4.25%. The Bank of Canada has been among the most aggressive of any OECD central bank in lifting interest rates to slow economic activity. Centre for Future Work Director Jim Stanford was interviewed about the Bank’s decision in numerous media outlets. In this segment on CBC News Network, anchor Andrew Nichols asked about alternatives to higher interest rates for controlling inflation: Another CBC story, by Stephanie Hogan, provided a roundup of differing views (including Jim’s) on the…

  • Employment & Unemployment,  Macroeconomics,  Research,  Wages

    Fifteen Super-Profitable Industries are Driving Canadian Inflation

    A new research paper from the Centre for Future Work sheds new light on the role of surging corporate profits in driving higher Canadian inflation. The report provides details on net income in 15 super-profitable private-sector industries in Canada, based on newly released data from Statistics Canada. It compares the most recent 12-month period to profit levels before the pandemic (in 2019). Combined profits in those 15 sectors grew by 89%, rising by a total of $143 billion. In contrast, profits in the other 37 business sectors tracked by Statistics Canada fell over the same time. The oil and gas industry experienced by far the largest increase in profits: up…

  • Commentary,  Employment & Unemployment,  Macroeconomics

    Canadian Domestic Economy Fell Into Recession in the Autumn

    New economic data  from Statistics Canada, covering the third quarter of 2022 (July through September) indicate that the recession feared by many forecasters has already started in Canada’s domestic economy. After a year of rapid slowing, real domestic demand (excluding international trade) shrank in the third quarter at a 0.6% annualized rate. After months of rapid interest rate increases imposed by the Bank of Canada to slow job-creation and economic activity, many components of domestic spending (especially those sensitive to interest rates) are now contracting. Household consumption, residential building activity, business machinery and equipment investment, and public sector investment all declined in the third quarter. Despite the contraction in domestic…

  • Commentary,  Employment & Unemployment,  Inflation,  Macroeconomics

    Saying the Quiet Bits Out Loud: Bank of Canada Aims to Raise Unemployment

    It will seem irrational to most Canadians, but the surprising truth is that the Bank of Canada is explicitly trying to increase unemployment. The Bank’s Governor Tiff Macklem recently claimed that the unemployment rate in Canada was too low: “unsustainable,” in his words, and must be increased by using high interest rates to slow down economic activity and reduce employment. This idea – of using unemployment as a deliberate tool to undermine wages and protect business profit margins – has been implicit within orthodox monetary policy for many years. But it’s both rare and angering to hear that made explicit as the goal of economic policy. In this commentary, originally…