Month after month, Canadians are still getting poorer.
A surprise job gain – 104,000 vs economists expectations of 5,000 – is being trumpeted by supporters of the Liberal government as evidence of economic strength.
However, a closer look reveals things are not quite what they seem.
For example, wage growth actually slowed to 5.1%. When you consider that inflation is 6.8%, then you can see how Canadians are becoming poorer and falling behind on average.
Additionally – as reported by BNN Bloomberg – productivity remains stagnant:
“Total hours worked, which feeds more directly into GDP calculations, was little changed on the month. Despite the apparent hiring spree, the economy didn’t seem to be producing much more goods and services,” said Royce Mendes, managing director and head of macro strategy at Desjardins Group, in a note to clients on Friday.
“Our tracking for Q4 (fourth quarter) GDP will likely remain around 1.5 per cent.”
The annual pace of wage gains also decelerated last month. Year-over-year wage growth came in at 5.1 per cent, marking the seventh consecutive month its been above five per cent.
“Overall, the picture painted by today’s Labour Force Survey is hardly as strong as the headline jobs reading would suggest,” Mendes said.”
Christmas job surge
It is well known that there is often a big surge in jobs around Christmas, as retailers temporarily increase hiring in a response to a rush of shoppers.
Additionally, the fact that Canada’s population growth is hitting new record highs means there will inevitably be more jobs.
What really matters is whether those jobs are productive, and whether Canadians are doing better on a per-capita basis.
Wages lagging inflation and stagnant productivity both demonstrate that Canada isn’t achieving any real economic growth, and is instead experiencing the illusion of growth.
Month by month, the government will have statistics to point to and claim their policies are working, while the per-capita situation for Canadians will worsen.
Any country can ‘grow’ by expanding the population, but it’s only productivity growth that makes a difference in the individual lives of Canadians.
With a government determined to keep raising taxes, and keep rejecting opportunities like selling LNG to Germany while covering up our crumbling economy with massive government spending and population increases, we will have to continue to be diligent in sifting through information to see what is really happening.
Spencer Fernando
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