Beware of End of Year Job Numbers

Today, Canada’s federal government released the latest unemployment rates for the country – painting a rosy picture if you believe ‘em.

According to Statistics Canada, the country’s unemployment rate dropped last month by a tenth of a point since October. Canada’s official unemployment rate now stands at 8.5 percent.

The government claims this is because the number of full-time jobs increased by 39,000 in November, which is the third straight m

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onth of an increase. Part-time jobs also increased by 40,000 – previously they had decreased in the past two months of October and September.

That means we saw 79,000 new jobs created in Canada – if you believe all the media hype. For most of us, the worst global disaster since The Great Depression of the Dirty Thirties is still rampaging its wrath. I personally know many families which continue to struggle to put food on the table, despite the constant headlines hollering that the economy is improving.

Chances are if you aren’t one of the millions looking for work, you know someone who is. So as you hear the network news anchors boast about our country’s new low unemployment rate, you may ask yourself: “so how come my friend is still out of work?”

Truth is the unemployment rate just doesn’t take into account the very basis for real value employment in this country – or any country for that matter.

The federal government’s statistics do not take into consideration the largest area of employment for the past twenty-years – self-employment.

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Over the past two decades, companies have been hiring fewer and fewer on staff, favoring the more cost effective approach of bring in people on contracts.

Also, as the economy shrank in the recessions of the 1990’s and today, many people were let go, at times when there were no jobs. Many simply gave up looking for work, and went into contracting as they were unable to find anything else.

Last month’s self-employment numbers fell sharply by 32,000 self-employment jobs according to Statistics Canada. These numbers are not considered in the unemployment rate calculations, the government thinks of them as more of a wild card which indicates the volatility of the job market.

Not only do the unemployment rates not consider one of the largest sectors of jobs in the country, they also fail to take into account the real money maker for most people – hours worked. The Canadian government only compares full and part-time positions – they don’t take into account the actual number of hours people work, and that’s what really affects most pay cheques.

The total hours worked actually declined last month by 0.3 percent according to Statistics Canada. This means although more people were being hired, they were working fewer hours, so in the end, were being paid less.

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When people don’t make as much as they once did, they cut back on spending, and that means less money being distributed into the economy, which fuels economic downturns such as a recession or depression. Statistics already are indicating that most Canadians plan to spend 40 percent less on holiday gift purchases this year than last year – and last year at this time we were well into the worst economic decline since The Great Depression.

And to add some vinegar to a widening wound, most of the increases in employment were in the education and service sectors.

In the education sector, this increase could be due to budgets needing to be spent before year-end, otherwise the money is gone for good. Meaning next year at this time, we could see a sudden loss of jobs in this sector, as everything eventually balances out.

The December holiday shopping season always boosts employment in the service sector at this time of year, as those in this sector make most of their profits during this time. Many companies in the service sector hire part-time temporary workers to fill the holiday rush, only to be let go either at the end of the year or early in the New Year. So again, these numbers are not a good sign of more jobs and a better economy.

So, how will you know when the economy really is booming again? You’ll know from your own experiences, and the experiences of the people in your life, long before the Canadian government’s statistics confirm what you and your family and friends experience.

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U. S. Economy Heading Towards Another Crash

Both Canadian and American governments have boldly declared the worst economic downturn since The Great Depression over, finished, D.O.A.

Don’t know what the economists in those countries are smoking, but the facts don’t backup that claim.

Unemployment in both countries actually rose last month over previous ones, and in the United States, there are other faltering factors all pointing to the possibility of another credit crunch and crash.

American consumer spending is still contracting, and although the price of

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homes rose slightly in the summer in the States, those prices are falling again – mainly because people aren’t buying homes – or any big ticket items. Credit card rates in the States have also dramatically increased, despite the U.S. Federal Reserve’s extension of generous interest rates to banks.

All of these symptoms were part of the problem which led to the original economic slump, and could easily be the cause of another one – just as bad or worse. If the American economy fails again so quickly, the recession (some might call it a depression) would be far worse, as many still haven’t recovered from the current economic mess.

So what is going on in one of the most powerful nation’s on the planet? Why is the economy heading back into the depths of fiscal hell?

U.S. President Barack Obama’s own economic recovery plan is partly to blame – despite its intent to revive the ailing American economy.

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Credit card rates were suddenly jacked up recently, even for many Americans who had excellent credit, and pay their bills on time. Thanks to a law passed in May by Congress, requiring banks to give 45-days notice before raising rates – to give the banks time to abide by the new regulations, Congress didn’t make the law effective until February 2010. Naturally, all the banks hiked their rates well before the new law took effect.

This meant many people who weren’t expecting their rates to increase, suddenly were hit with major credit card rate increases.

Though this new law will also go further to harm the economy, by severely restricting the available credit issued to consumers. As banks are more limited in terms of their ability to raise their rates, many who can’t pay their bills on time will have their credit cards canceled. Many more with less than stellar credit histories will be turned away.

The faltering economy has already reduced the available amount of credit issued to consumers. In the third quarter of 2006, banks sent 2.1 billion direct mail credit card offers, according to research firm Mintel, this year in the same quarter that number was only 391 million.

Clearly credit card companies and banks are monitoring current and potential customer spending habits more closely. Some credit card companies have even gone as far as to cancel customer cards just for using their credit cards at businesses which typically are used by consumers with poor credit histories – even if they themselves have excellent credit ratings.

President Obama’s economic recovery plan was supposed to build consumer confidence, which in turn would get people spending, and that would charge the economic engine, driving us out of the global economic downturn.

Instead, many of the policies are doing just the opposite, creating fear – on the part of banks and credit issuers – which reduces the amount of money consumers have available to spend. This slows the economy down, as consumer spending drops – as it has.

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Although the credit card freeze wasn’t the best issued legislation by the American government – they should have included some plan to ensure credit card issuers wouldn’t hike rates immediately to avoid the new law – part of the blame does go to the credit card issuers themselves.

These credit issuing companies intentionally raised their rates to avoid a new law, geared towards protecting their customers. By forcing credit card companies and banks to provide 45-days notice prior to a rate increase, it gives the card holders an opportunity to determine if they can continue to afford the credit card, and if not, to cancel it before they get into serious financial trouble.

By jumping the line by raising rates ahead of the 45-day notice period law, these credit card issuers have taken away their customer’s right to choose the best route to take for their own financial well being.

Still, all the warning signs are screaming that the American economy is heading towards another dive – whether this one will be as dire as the one we’re still in remains to be seen. But all the positive hoopla the American government is spreading is pure propaganda – we are not out of fiscal hell – not yet.

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Signs of the Times – McWomen

One of the surest signs the economy is actually doing better – as the Bank of Canada and many economists claim – is an increase in jobs. The more people working, the better the economy – right?

Not necessarily – just because there are more jobs, doesn’t mean the economy is back to its former glory. Long gone are the high paying jobs which pay the bills, replaced with many so-called “McJobs” which don’t.

Case in point, recently Canada’s bean counter – Statistics Canada – released figures showing that for the first time ever, there are more women than

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men in Canada’s workforce.

The survey found that about 7.1 million women were earning wages in the first half of 2009, compared to only 6.9 million men for the same time period.

Women outnumbered men in both the under and over 25-years-old demographics – another first.

Labour groups and women’s organizations are the first to point out that these numbers don’t reflect changes in attitudes towards women in the workforce; rather, they are due to layoffs in male-dominated industries such as manufacturing, automotive and construction sectors.

Women on the other hand are more likely to take up many of the part-time McJobs in retail, as office temps (you don’t hear many men call themselves “a Kelly Girl”), and other low-wage earning jobs.

Just last month, Canada’s national banking regulator, The Bank of Canada boldly declared the recession over. Far be it from over, when the jobs that are out there are slim pickings for earning a decent wage to support oneself.

How can one put food in one’s tummy, clothes on ones back, and a roof overhead working for minimum wage?

Many families are still reeling from the economic depression we’re still in – despite the declarations of it being over by the Bank of Canada.

Canada’s national bank should be called on the carpet for its undignified premature announcement. Although they are trying to end the fear to spend, which would encourage growth, to stimulate the economy, they are actually deepening the wounds created by this bleeding fiscal mess.

By prematurely announcing the end of the recession in Canada, they have demonstrated to those who are still living through it that the government has absolutely no idea what is going on, or how to really resolve it.

They also alienate those who are struggling, by showing a complete lack of concern for those in need, and in turn push those who are desperate for government assistance away.

It is time the government of Canada stopped pumping out propaganda, and actually came out with a strategy to stimulate the economy, and create real, long-term, sustainable jobs, that aren’t simply McJobs, but real ones, with real futures for both men and women.

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The Great Recession - What a Load of Hooey

Last month we told you how despite the continued faltering of the global economy, Canada’s national fiscal regulator, The Bank of Canada, boldly declared the recession over. At the time, we disagreed, because of the lack of supporting evidence presented by the nation’s bank.

Last week, the Canadian and American governments released their unemployment figures July - and just as we told you last month - the so-called recession isn’t over yet, at least not in Canada.

Statistics Canada said there was no sign of economic recovery last month, with a loss of over 45, 000 Canadian jobs, despite the Bank of Canada’s previous claim.
Though the American economy did do a tad better, showing a slight i

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ncrease in jobs - the first such increase in over 15-months.

This whole economic meltdown has government deception written all over it.
Instead of declaring it what it really is - a depression - economists at major private and public financial institutions continue to refer to as a “recession.”

This is because technically, it hasn’t lasted long enough to be a depression. But the affects of the current economic crisis are far worse than they were during the Great Depression of the “dirty thirties,” so doesn’t it make sense to call this fiscal mess what it really is - a depression?

Some clever financial analysts have come up with ways of describing the astronomically bad nature of the current economy, without using the “d”epression word.

I heard one the other day call it the “Great Recession” linking it to the nature of the Great Depression, but without using the word “depression.” Some just refer to it as the “worst economic slowdown since the Great Depression.”

Far more just talk about the effects on jobs, people’s homes and saving instead of actually talking about what we really are in. They talk around the issue, describing the situation, without actually defining it. Clever - and possi

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bly scary - would you want this type of person responsible for your finances?

Truth is, we are in something far worse than an economic depression. It’s so bad, economists don’t have a word to adequately describe it. The economy will never be the same - we’ve lost jobs that will never come back, companies that were fiscal powerhouses in their business and industry sector have disappeared completely, more people have lost their jobs, their homes, their cars, and in the most literal sense of the word - their way of staying alive - than at any other point in history worldwide.

Governments have had to bailout mega-big businesses including the auto sector and various airlines. People have cut back on once thought normal, every day activities, like going to the movies, eating out, or having that morning coffee, just to scrounge up enough savings to have some money for the basics.

More people go without the basics everyday than ever before - things like food, clean drinking water, clothing, and a roof overhead.

The economy will get better, it has too, that’s the nature of the Capitalistic system. But we are far from out of the worst economic . . . or f*ck it - we are far from being over this global economic depression.

Before it is a distant memory, more people will lose their jobs, millions more will lose their cars, and homes, and governments will continue to forecast the end.

Well, eventually they will get it right. If you keep calling the cars passing by a “bus” eventually, when a “bus” passes by, you’ll be right.

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Economists Nowhere Near Reality

Today, the Canada’s federal financial regulator – the Bank of Canada – boldly declared the recession over.

The national financial regulator – which sets the stage for how other financial institutions across the country will operate – estimated that the Canadian economy will advance by 1.3 per cent during the current July to September period and three per cent in the final fourth quarter of the year.

The optimistic view of the economy had an immediate effect on the Canadian dollar, which jumped 0.97 cent to 92 cents U.S.

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However the Bank of Canada is still concerned about the slumping American and European markets, and says they may contain more unpleasant surprises, which could affect the global economy just as it did back last October.

Wait a sec . . . the Bank of Canada says we’re out of the woods, but we’re still in the forest?

Doesn’t make sense – Canada isn’t the only country affected by the global economic downturn, Canada is very much tied to the American and European markets.

So how can the country’s national fiscal institution declare the recession over?
One word: posturing.

The stereotyped image of the tight-wad, highly cautious, nerdy banker-type rings true. Those in positions to influence world economies are easily spooked by even the tiniest of teeny-tiny things.

Just look at how fast most of the major trading indexes of the world fell when the planes crashed into the World Trade Center on the infamous “9-11” – trade indexes in Canada, Europe and Asia all dropped, even though they all were many hundreds – if not thousands – of miles away.

The same holds true when good news spreads from reputable sources, such as the Bank of Canada – even though it may only be a prediction, estimate, or the result of someone holding out on his or her lucky rabbit’s foot for luck.

Despite the numbers released by the Bank of Canada, this sounds very much like political posturing, in an attempt to stimulate the economy. By claiming the country is out of the recession – or will be by the end of the summer – investors will have more confidence to put their money back into the market, and that influx of dollars should help the wheels of the economy.

In theory, that sounds great – but just how realistic is it, given the dependence on most nation’s economies by the big American financial machine?

Don’t be fooled by premature statements, driven by lucky rabbit’s feet. Just look at what is still going on around you and ask yourself if we really are out of the woods.

Almost 400,000 Canadians have lost their jobs since October – and just how many of those people are still out of work or working in underemployment situations, just to make ends meet?

Many businesses are still suffering – just go to your local mall and count all the empty and gone out of business stores.

More people in Canada are depending on food banks to feed themselves and their families than ever before – simply because they can’t afford the basic

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needs for themselves.

Canada’s economic recovery may be taking place, but clearly we have a long way to go before declaring the recession a done deal.

And that economic recovery could be stalled or even halted suddenly, if the economies of the States and/or Europe continue to tumble, as they presently are.

The financial stimulus package American President Barack Obama launched in the spring is meeting with mixed results. On the one hand, it is providing some movement of funds in the economy, but on the other hand, people are still losing their shirts – or worse – their homes.

Until the American economy is stable and once again prosperous, the Canadian economy won’t be.

Keep stroking that lucky rabbit’s foot – but I’m waiting for more evidence before considering the recession over.

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