In this edition:
- Niagara unemployment hits lowest rate on record
- Governments of Canada and Ontario building largest electricity battery storage project in Canada
- Legal cannabis industry launches class action against major Canadian banks
- Without investment, Canadian wages could reignite inflation: RBC
- No decision: Difficult budget deliberations taxing Niagara regional councillors
- Unlikely that central banks will cut rates this year: Mark Carney
Job Title Inflation
Kim Jong-un — the North Korean dictator — is not normally seen as a trendsetter; however, he clearly leads the pack in job title inflation. The BBC reports that the 37 year old has more than 1,214 different titles; titles such as President of North Korea, Chairman — State of Affairs, General Secretary of State, Executive Policy Council Chair, External General Secretary, Politburo Chief, General Secretary of State, State of Affairs Commissioner, Guardian Deity of the Planet… and the list goes on and on and on.
We are all very cognizant of economic inflation. As a matter of fact we talk and worry about it every day but, one thing we don’t realize is when it comes to job titles we live in an age of rampant inflation. It seems to me that a number of people I meet are a chief or a president in some variety. Title inflation has been producing its vocabulary for years with an abundance of “up-titling” and “title-fluffing” while producing a technological molecule. As one of my clients said to me, “there’s a simple formula; just take your current job title — mix in a few grand words such as global, international, interface, and customer and wala — you have new title. Some of the best titles I’ve heard are: Social Media Ninja, Chief Know It All, Chief Happiness Officer and Chief Scrum Master.
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Niagara unemployment hits lowest rate on record
Niagara’s unemployment rate in January, 2023 was a mere 4.3%, the lowest recorded in all available comparable data (going back to March 2006). The size of the labour force, at 231,000, remains below the peak seen of 245,500 in April of last year, but nevertheless remains larger than either before or during the pandemic. Total employment (the number of people working) also remains below its April, 2022 peak, but is continuing to rise. The participation rate (the number of people either working or actively seeking work) is similar, indicating there may still be untapped workers in Niagara who could be enticed back into the workforce. As the unemployment rate drops and the war for talent intensifies, employers will have to examine both better wages and non-monetary benefits such as flexible scheduling or four-day-weeks to remain competitive.
Nationally, employment increased by 150,000 (+0.8%) in January, and the unemployment rate held steady at 5.0%.
Employment gains were driven primarily by people aged 25 to 54 (+100,000; +0.8%), split evenly between women and men in this group. Employment also increased among people aged 55 and older (+43,000, +1.0%), while it was little changed among youth aged 15 to 24.
Governments of Canada and Ontario building largest electricity battery storage project in Canada
The governments of Canada and Ontario are working together to build the largest battery storage project in the country. The 250-megawatt (MW) Oneida Energy storage project is being developed in partnership with the Six Nations of the Grand River Development Corporation, Northland Power, NRStor and Aecon Group.
The federal government is today providing a further $50 million in funding; the Canada Infrastructure Bank has played a key role supporting project development and is collaborating with the Oneida Energy storage project on an investment agreement. This project is another milestone in Canada and Ontario’s plans to build the reliable and affordable clean electricity grid that will help to power the future of Ontario’s economy.
Legal cannabis industry launches class action against major Canadian banks
Groupe SGF (Cannabis Legal Advisors and Consultants) announces a class action lawsuit on behalf of Mr. Gabriel Bélanger (Founder of Origami Extraction Inc.) against the Desjardins Federation, National Bank, Royal Bank, Bank of Montreal, TD Bank, and CIBC. The lawsuit alleges that the named banks have engaged in financial discrimination against actors in the legal cannabis industry in Canada.
“For far too long, Canadian banks have treated the cannabis industry like pariahs, as if it was still completely illegal. By doing so, they are depriving the Canadian, but especially the local economy of developing a promising market,” said Me Maxime Guérin, Lawyer, Groupe SGF – Cannabis Legal Advisors and Consultants.
Without investment, Canadian wages could reignite inflation: RBC
Accelerating wage growth and historic worker shortages characterized the labour market for much of 2022. As of November, average hourly earnings rose ~10% compared to pre-pandemic levels—the fastest pace over a time period of that length since the 1990s.
But that still wasn’t enough to catch inflation, which soared 12% above where it was before the crisis. And as workers grappled with higher prices, they were also saddled with an almost 20% jump in debt servicing costs as the Bank of Canada aggressively raised interest rates. By our count, household income after taxes, debt payments, and inflation was 0.2% lower in 2022. We expect an even larger 1% drop in 2023 as Bank of Canada interest rate hikes (adding to 425 basis points over the last year) continue to flow through to debt servicing costs.
The concern now is that strong wage growth will persist to the point that it becomes counter-productive— that is, where it begins to push the price of goods and services above actual purchasing power. Should soaring wages fuel greater spending, they could at best slow the pace at which inflation eases and at worst, reignite it.
No decision: Difficult budget deliberations taxing Niagara regional councillors
Niagara Region councillors started Thursday’s budget committee meeting looking at a 9.4 per cent budget hike — and ended the meeting with a 9.4 per cent budget increase.
They voted to defer the decision on the levy, which decides what residents will pay in taxes for 2023, and scheduled an extra meeting for Feb. 16, which will give them extra time to search for savings and digest the hundreds of pages of reports.
“I think we have to understand what we’re looking at fully,” said St. Catharines Regional Coun. Tim Rigby, who is in his seventh term on regional council, including three as mayor. “A lot of people sitting around this table can’t believe how big it is this year.”
Councillors considered a levy budget with gross expenditures of more than $1 billion, including $197 million for policing, $23 million for Niagara Regional Housing and $7.5 million for the Niagara Peninsula Conservation Authority — budgets in which council has next to no authority to make changes.
Unlikely that central banks will cut rates this year: Mark Carney
If you’re hoping to see cuts to interest rates this year it is unlikely to happen, former Bank of Canada governor Mark Carney said in an exclusive interview with BNN Bloomberg.
While the fight against inflation sparked a series of aggressive interest rate hikes worldwide, the cost of living remains too high to reverse course, Carney told BNN Bloomberg in an interview that aired Friday.
“I don’t think it’s likely at all that central banks are going to be cutting rates later this year,” Carney, who is also a former governor for the Bank of England, stated.
Focus on International Trade
Charting globalization’s turn to slowbalization after global financial crisis
The free flow of ideas, people, goods, services, and capital across national borders leads to greater economic integration. But globalization, the trend toward these things moving ever more freely between nations, has seen ebbs and flows over the decades.
Those trends are coming into sharper focus this year as policymakers work to understand and address the prospect of geoeconomic fragmentation, which threatens to undo the integration that has improved the lives and livelihoods of billions of people.
Looking back over a century and a half of data, the main phases of globalization are clearly visible using the trade openness metric—the sum of exports and imports of all economies relative to global gross domestic product.
As the Chart of the Week shows, globalization plateaued in the decade and a half since the global financial crisis. This latest era is often referred to as “slowbalization.”
Through the Daily Updates, the GNCC aims to deliver important business news in a timely manner. We disseminate all news and information we feel will be important to businesses. Inclusion in the Daily Update is not an endorsement by the GNCC.