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Yahoo
2 days ago
- Business
- Yahoo
Job vacancies slump as tariffs push some sectors below pre-pandemic levels
The weight of Donald Trump's tariffs is being felt in several sectors of the Canadian labour market, with job vacancies in some industries dropping below pre-pandemic levels, says an economist. Job vacancies fell 3.8 per cent in the first quarter from the fourth quarter of 2024 and were down 18.1 per cent from the same quarter last year, according to Statistics Canada data released Tuesday. 'The general message of the report is we have a slowing labour market,' Charles St-Arnaud, chief economist at credit union Alberta Central, said. 'We are seeing signs of increased slack in the economy and businesses that are not willing to hire.' He said tariffs are one of the factors having an effect on vacancies, pointing out that vacancies in the trade-sensitive retail sector fell to their lowest level since the fourth quarter of 2016. Warehousing and transportation vacancies dropped to their lowest level since the third quarter of 2017. Other sectors where openings have contracted below 2019 levels include information and culture and finance and insurance. Overall, job vacancies are down to average levels recorded pre-pandemic. Still, the declining number of vacancies signals that Canada's job market is 'stalling,' St-Arnaud said. Statistics Canada has tracked a rising unemployment rate and negative average job gains from February to May. The jobless rate in Canada currently stands at seven per cent, and has steadily risen since dropping to a record low of 4.8 per cent in July 2022. The vacancy report lines up with what the job numbers have been telegraphing, St-Arnaud said. In the first quarter, the number of unemployed people rose 200,900, while the number of job vacancies fell by 115,200. That led to the unemployment-to-job vacancy ratio — the number of people without work per position — rising to 2.9 per cent in the first quarter compared to 2.8 per cent in the fourth quarter and two per cent a year ago. Along with tariffs, 'relatively weak' economic growth over the past few quarters has discouraged businesses from making new hires, something that is proven out by a 'negative' Canadian Federation of Independent Business hiring intentions index. Slowing population growth curbed demand and that, too, has dampened hiring, St-Arnaud said. Another symptom of shrinking vacancies and demand for workers is the slowing average hourly wage growth. Statistics Canada also said vacancies fell the most for jobs that called for a high school diploma or less. Canada's youth job market 'in dire straits' Canada's unemployment rate hits 7% St-Arnaud said the first quarter results likely pave the way for more of the same in the second quarter. 'What we're seeing will likely continue: the same trend of (a) continued, gradual, kind of more marginal decline in the vacancy rate going forward,' he said. • Email: gmvsuhanic@ Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Globe and Mail
10-06-2025
- Business
- Globe and Mail
Why is Alberta so grumpy? The truth is the West has been struggling badly
Charles St-Arnaud is chief economist at Alberta Central. The following is adapted from a recent report by the financial institution. Western alienation has a long history in Alberta, from the lack of bank lending to the province in the 1930s, to the National Energy Program in 1980, to what is currently viewed as an overrestrictive regulatory framework that stymies the oil and gas industry. With this as a background, the election of a fourth consecutive Liberal government has led to the most recent surge of discontent in Alberta and fanned the flames of separatism to the point where a referendum on the subject is becoming highly likely. The reaction and dismay in other parts of Canada to that rising discontent is a sign that the rest of Canada is oblivious to Alberta's situation. The main reason behind the growing discontent? As U.S. Democratic strategist James Carville described the central issue of the 1992 presidential campaign: 'It's the economy, stupid.' This is what makes the situation in Alberta more comparable to the campaign for Brexit than to the sovereignty movement in Quebec. And, despite the Alberta government's assertion that the province is doing great economically, it is not; in fact, it has been struggling for the past decade. Andrew Coyne: We wasted 60 years indulging secessionist fantasies in Quebec. Must we make the same mistake in Alberta? Opinion: The spectre of Alberta separatism might actually be good for Canada's economy Many look at Alberta with envy, as it is the wealthiest province, boasting a GDP-per-capita of approximately $72,600 in 2024, roughly 30 per cent higher than the national average. However, what is less well known is how Alberta has experienced a significant decline in its standard of living and household purchasing power as it adapts to the 2014 oil bust. Following the 2014 crash, Alberta's economic activity declined by about 7 per cent, and it took eight years to fully recover. To put this into perspective, this represents a similar economic downturn to the one experienced by Spain, Portugal, and Italy during the global financial crisis. As a result, Alberta's GDP per capita in 2024 was only marginally above its level in 2004. In other words, the province's living standard have not improved in two decades. This situation has significant implications for households in the province. While Albertans' real disposable income per person is still higher than the national average by about 5 per cent, it has declined by about 13 per cent since 2014. This represents a significant reduction in the average Albertan's purchasing power, with the province's performance trailing that of B.C., Ontario, and Quebec, which gained 9 per cent, 5 per cent, and 7.5 per cent, respectively, over the same period. Some would argue that the decline in purchasing power is only a result of a drop in incomes over the past decade for workers in the oil patch, but this is not the case. However, looking at median wages, adjusted for inflation, purchasing power has fallen for workers in most industries since 2014, led by the education, health care, construction, and arts and entertainment sectors; oil and gas workers have seen an increase in their purchasing power over the period. In addition, since the mid-2010s, younger and older cohorts of workers, especially men, are less likely to be employed now than they were 10 years ago; the employment rate for both groups has dropped by about 10 percentage points. The general feeling that is fuelling discontent in the province is that no economic progress has been made over the past decade, and that Albertans are falling behind, whether individually through lower purchasing power and employment potential, or collectively, because of a lack of growth in GDP per capita and prolonged recovery. This situation is similar to what has been observed south of the border, where manufacturing workers feel that the system has left them behind, fuelling the populist movement. A lack of understanding of the situation only fuels more resentment; remember presidential candidate Hillary Clinton's comments regarding the 'deplorables' during the 2016 U.S. elections. These economic developments are mostly the direct impact of the oil bust of 2014 and a global reduction in investment by oil and gas companies over the past decade. However, the federal government is not without blame. Many regulations introduced in recent years, whether it's the 'emission cap' or the 'clean electricity grid,' have been badly designed and often affect Alberta disproportionately. The inherent flaws in these regulations raise questions about whether the federal government is intentionally trying to hurt Alberta. With all this in mind, the rest of the country should, to quote fictional TV soccer coach Ted Lasso, 'be curious, not judgmental.' Most Albertans, having fallen behind over the past decade, do not want to separate, but they want their concerns to be known, acknowledged, and heard by the rest of the country. Some understanding and empathy could go a long way to bridge the gap.
Calgary Herald
21-05-2025
- Business
- Calgary Herald
Varcoe: Weak growth, rising prices make job 'a lot hard harder,' as central bank governors meet in Banff
Article content In Canada, data released this week indicated the year-over-year inflation rate increased by 1.7 per cent in April, down from a 2.3 per cent hike in March. Article content The drop was powered by lower pump prices, which tumbled 18 per cent from a year earlier as the federal government ended the national carbon tax and oil prices dipped. Article content Without the effect of energy and the carbon tax, the inflation rate increased by 2.9 per cent, up from 2.5 per cent in March — and consumers continued to feel the pinch at the grocery store. Article content 'On the surface, it looks OK, but when you dig and look under the hood, there'd be reason to be concerned,' said Alberta Central chief economist Charles St-Arnaud, noting core inflation was above three per cent. Article content 'It puts the Bank of Canada in a very hard situation, because we've seen the labour market be on the weaker side . . . Normally, the bank could cut to provide support, but with inflation being at the top end of the inflation target — and maybe above — it starts to be harder for them to justify cutting.' Article content Article content Over the past year, the Bank of Canada has reduced its key policy rate from five per cent down to 2.75 per cent, although it has left it unchanged since the last adjustment in March. Article content With the economy slowing and unemployment rising, it sparks questions about the best approach to deal with rising prices. Article content During a speech in Calgary in March, Macklem was asked about the risk of stagflation facing the Canadian economy. Article content 'The reality is new tariffs, combined with retaliatory tariffs, mean a weaker economy and higher inflation,' he told the audience. Article content 'A weaker economy is going to put downward pressure on inflation. New costs, new tariffs, a weaker exchange rate, supply chain disruptions, those are all going to put upward pressure on inflation. So we're looking at both of those pressures.' Article content South of the border, the U.S. gross domestic product contracted during the first quarter, and the Federal Reserve decided earlier this month it would not reduce interest rates. In April, the U.S. inflation rate was 2.3 per cent compared with a year earlier. Article content Article content Analysts believe a trade deal reached between the U.S. and the United Kingdom this month could help ease the uncertainty on the trade front compared with early April, after the White House unveiled its reciprocal tariffs, which were later paused for 90 days. Article content Article content But at his company's investor day meeting this week, JPMorgan Chase & Co. CEO Jamie Dimon spoke about trade concerns still creating risks. Article content 'I think the chance of inflation going up and stagflation is a little bit higher than other people think,' he said. Article content Poloz, who was Bank of Canada governor from 2013 until 2020, noted the U.S. baseline tariff rate of 10 per cent that the United Kingdom agreed to is still relatively high. Article content And he equated the uncertainty and effect of tariffs on the economy to 'throwing sand into the gears of a beautiful Ferrari. It just doesn't work as well as before.'
Calgary Herald
20-05-2025
- Business
- Calgary Herald
Varcoe: 'Frank discussion' on tariffs inevitable, as G7 finance ministers meet to discuss global economy
Article content Article content Champagne said tariffs have 'brought a level of uncertainty and instability in financial markets that we have not seen in a long time.' Article content The U.S. has placed tariffs on Canadian steel, aluminum and some auto parts, and implemented 'reciprocal tariffs' on other countries last month, which were then paused for 90 days. Article content On Sunday, Bessent told CNN that the United States could reinstitute reciprocal tariffs on other countries, noting 'President (Donald) Trump has put them on notice that if you do not negotiate in good faith, you will ratchet back up to your April 2 level.' Article content Part of the concern in Washington has focused on the trade deficits that the U.S. has with other countries, including Canada. Article content Last year, Canada had a merchandise trade surplus of $102 billion with the United States, driven largely by energy exports. Article content Earlier this month, the U.S. administration reached a trade deal with the United Kingdom — with a 10 per cent tariff on imports into the U.S. — and a temporary arrangement with China on lowering sky-high tariff rates. Article content Article content 'I don't have a crystal ball, but one thing is clearer, (that) we know more today what kind of deal the United States may be looking for from its partner,' Champagne said. Article content 'In a sense, the blueprint that has come out from the deal between the United Kingdom and the United States is giving some indication as to where the White House may want to go when it comes to trade deals.' Article content Article content Analysts have wondered if the other countries in the group will develop a common position on American tariffs, given they're facing a similar challenge. Article content 'We all have our own distinct reality. I mean, the reality of Canada is that we are the largest trading partner of the United States, so our reality is somewhat different than some of the other countries,' said Champagne. Article content Article content 'I always say that there might be short-term turbulence, but I'm very confident that in the long term, we're going to build a more prosperous, more resilient, more ambitious Canada.' Article content Alberta Central chief economist Charles St-Arnaud said the trade war has rattled the global economy, although there is more clarity today than on 'Liberation Day,' when the U.S. unveiled its reciprocal tariffs and sent tremors through stock markets. Article content 'The uncertainty is still quite high,' St-Arnaud said Tuesday. Article content 'The extreme downside risks of a global recession have been reduced, but it still means global activity will be slower than what we thought at the beginning of the year.' Article content Article content Indeed, the state of the global economy remains 'precarious' and tariffs have created a sense of economic uncertainty, making it difficult for companies to make investments, said Matthew Holmes, executive vice-president of the Canadian Chamber of Commerce.
CBC
01-03-2025
- Business
- CBC
'Uncertainty is almost as bad as the tariffs themselves': Tariff threat alone hurts Alberta
U.S. President Donald Trump's tariff threats have been top of mind for Canadians since he took control of the White House, and whether or not that threat actually materializes, some are concerned the uncertainty is already affecting business operations north of the border. Originally, Trump said tariffs levied against Canada would land on Jan. 20, his first official day in office. Then, that tariff deadline was pushed to various dates within the month of February. When those new dates rolled around, Trump mused about a March 4 deadline, promising a 25 per cent tariff on virtually all Canadian goods and a tariff on Canadian energy set at 10 per cent. After some confusion about what goods would be subject to tariffs and when, earlier this week the deadline for tariffs against Canada seemed to shift to April 2, but as of Thursday morning, the president had arrived back at March 4 for most tariffs to take effect. In Alberta, the province that generates significant revenue for the rest of the country, largely thanks to the energy sector, various industries continue to brace for impact as the deadline for tariffs against Canada changes, again and again. But one economist suggests these last few months of uncertainty are already taking a toll on Alberta's economy. Charles St-Arnaud, chief economist with Alberta Central, which represents the province's credit unions, says the focus may be less about the actual deadline and more about the risk that threat stirs up within Canadian industries. "Many businesses that have a big level of operation and activity in the U.S. are reconsidering, 'Can I continue to do what I do with the threat … with the risk of having tariffs in three months, six months, or maybe a year from now?'" said St-Arnaud. He noted that companies with activities mostly in the U.S. may decide at some point to leave Canada if the uncertainty persists. St-Arnaud believes that, regardless of when or if the tariffs actually come into effect, the threat alone is enough to have an impact on Alberta's economy, referring to it as "death by a thousand cuts." "It's no longer just economics," he said. "It's politics, it's international relations. There's so many different angles to the situation that cannot be ignored." 'It's anyone's guess as to where this is heading' For independent businesses operating in Alberta, the idea of investing in an uncertain future could feel like a bad idea. "Uncertainty is almost as bad as the tariffs themselves because that causes businesses to have to put the brakes on all sorts of stuff," said Dan Kelly, president of the Canadian Federation of Independent Business. Kelly is concerned the uncertainty and chaotic messaging coming from inside the Oval Office may actually be Trump's end goal, as it drives behaviour for businesses. Kelly is concerned small businesses are already starting to look for ways to run leaner by thinning their head count or delaying planned expansions. It means the president may be successfully undermining the Canadian economy with these threats alone, essentially positioning the U.S. as a stronger, more reliable place to do business in. If a Canadian business owner is hoping to end the uncertainty, Kelly suggests the impending trade war could be a sign they need to expand or grow in the U.S. market, "to make sure that they're on the other side of the tariff wall." "And even for Canadian businesses that have operations in more than one country, does that mean that any growth is going to happen in the U.S. market rather than in Canada? All of those are bad things for our country." Kelly believes business owners and operators in Canada have met these tariff delays with mixed emotions. Some days, he says, the business community feels optimistic — other days, that hope is fleeting. "There has been a consistent threat of imposing tariffs on all or some Canadian imports into the United States since the president took office, with all sorts of milestones, differing dates, different information on what's happening," said Kelly. "It's anyone's guess as to where this is heading." $9.3B of agri-food products to the U.S. in 2024 The United States is Alberta's biggest trading partner, by far, across industries. Alberta exported over $156 billion worth of goods to the United States in 2023, a large chunk of the province's roughly $175 billion total exports to all markets last year. Behind mineral products, Alberta's second largest product export to the States falls under the food and agriculture category, exporting $9.3 billion in agri-food goods to the U.S. last year. Ryder Lee, general manager of the Canadian Cattle Association (CCA), an organization based in Calgary that advocates for beef farmers, says the sector has historically been successful thanks to business being done through a relatively open border. "What tariffs do is they make that border much thicker, more expensive to maybe make the decisions that make sense for businesses, for farmers and ranchers and feeders," said Lee. "That really sucks value out of the marketplace. It's going to add costs [for businesses], and add costs in the grocery store, too. So it's hard to find the spot where they expect to find the win here." Beef led Alberta's international agri-food exports at $3.8 billion, followed by $2.8 billion worth of wheat and $1.7 billion worth of canola seed, according to government data. The beef sector functions on a highly integrated Canada-U.S. supply chain. When tariffs were pushed off to Feb. 4 by Trump, the CCA announced it was "extremely disappointed" about the 25 per cent levies against beef producers. Since then, Lee said not much has changed about the organization's stance. "The details have been kind of short … and we'll probably be kept waiting right down to the wire to know what is [being levied] and what might not be, and until then you can't, you're kind of speculating on what the impact will be. And I don't like to do that kind of speculating," he said. Regardless, he said, people have been making hard decisions about business ever since the tariffs were being spit-balled by Trump late last year. Such decisions include keeping cattle over the summer to put more weight on them before selling, or selling more bulls this time of year. "With the uncertainty of what is going to unfold, how aggressive do you get on a maybe? And on what level? So people have taken steps, but it's sure difficult to decide how far you should go." Budget 2025 built around shaky ground The financial pressure tariffs would inject into the main artery of the Canadian economy — Alberta's energy sector — has also bled into the province's latest budget. Tabled on Thursday, the province based its 2025-26 fiscal plan on the assumption the president will hit the Canadian energy sector with 10 per cent tariffs, and that tariffs on other exports will average around 15 per cent for the year. Here, Alberta's estimate is that the tariffs will either be less than the 25 per cent Trump continues to promise, or that if they do come in at that number, they won't stick around for the entire year. Alberta is forecasting it will end the next fiscal year with a $5.2 billion deficit, but should U.S. tariffs manifest in a worst-case scenario, that number could climb to $8.7 billion. It marks the first deficit budget for an Alberta government since the 2020-21 fiscal year, which was presented during the early days of the COVID-19 pandemic. The province is also projecting that the West Texas Intermediate (WTI) price of oil — the North American benchmark price that Alberta uses for budgeting — will be $68 US per barrel in the 2025-26 fiscal year. It's a notable $6 decrease from the previous budget year's $74 per barrel estimate. Alberta oil producers may 'absorb some of the costs' Alberta is the largest source of crude oil shipped to the United States, exporting nearly $12 billion in energy products south of the border in December alone, according to the most recent provincial government data. St-Arnaud suggests the mere threat of tariffs is already widening the price differential between the price of American and Canadian oil. "We've seen evidence early on that when tariffs were announced … we've seen a widening of that spread," said St-Arnaud. "And that was without those tariffs being official." WTI represents a blend of light, sweet oil. It's easier to refine and it's good for making gasoline. Because of this, it's sold at a higher price than Canadian crude, called Western Canada Select (WCS). WCS is a much heavier, sour blend of crude oil that comes from Canada's oilsands. While it's better for making diesel, it's more difficult to refine, therefore it's priced at a discount to WTI. The concern around tariffs and the differential is that — while the price difference has always existed — tariffs would widen that gap even further, hurting revenues for Canadian producers by lowering the price they're able to fetch for a barrel of Canadian crude, and negatively affecting the economy overall. A widening differential is also something noted in the provincial budget, "as Alberta producers absorb some of the costs associated with U.S. tariffs on Canadian energy products." When asked about whether or not Trump's delay bought the energy sector any additional time to prepare for tariffs, a spokesperson for the Canadian Association of Petroleum Producers (CAPP) said in an email that the organization will "wait for an official announcement from the U.S. administration with additional details before offering any comments." Canadians should 'sleep with one eye open' As for Kelly, he believes even if the president doesn't go ahead with levies against Canada in the coming days — or weeks, or months — he doesn't anticipate Trump will stop repeating his threat. He suspects Trump's tariff rhetoric will hover over Canada's economy like a black cloud, and believes "we have to be prepared that just the threat of a tariff has its own negative consequences on the Canadian marketplace."
