Thursday, September 9, 2010

Why are 1.5 million people not working in Canada?

Forgive me, but I cannot understand the positive views put forth by some investment advisers, economists and  journalists of the mainstream media on the current state of the economy. I wonder if they truly comprehend the facts on the ground faced by average people and families, Main Street, or Economic Ground Zero.

The latest Statistics Canada figures show an 8% unemployment rate. Allow me to put that percentage in perspective on how it affects real people and families. In  actual number of people, our current Canadian economy has thus far pushed 1.493 million people out of work.That's almost the entire population of metropolitan Montreal, the closest city to where I reside.

In the United States, the unemployment rate is 9.6%, and 14.9 million people are not working. That's equivalent to the total number of people residing in New York City, Los Angeles and Chicago, America's three largest cities. Employers got rid of eight million jobs between 2008 and 2010, likely to never return.

And lest Canadians think we're all right because our job losses are putatively less, the bank of Canada's governor, Mick Carney, meted out more cautionary news, reports the Globe & Mail:

However, Mr. Carney left little doubt that the sputtering U.S. recovery is now the No. 1 risk to the global and Canadian recoveries, saying in the second paragraph of his statement that the rebound in private demand south of the border is being crimped by stubbornly high joblessness and that 'recent indicators suggest a more muted recovery in the near term.

Here's more sobering news about the U.S. economy, the engine that drives the Canadian and world economy. So, we should take note. There are at least 2.4 million more people not counted because they have given up looking for work, called discouraged workers, and another 8.9 million who have part-time jobs, but would like full-time employment, the US Department of Labor reports.

History Repeats Itself: Too many people do not have jobs, a stark reminder of the Great Depression.
Photo Credit: Hohn E Allen, Inc. Done for the WPA during the Great Depression.

Therefore, an astounding 26.2 million people are either not working or not working enough. That's almost double the official rate of 9.6%. The rate is closer to 17%. That means one person in seven has either insufficient work hours or no work at all. If that is not a crisis, I don't know what is.

David Rosenberg, chief economist and strategist for Toronto-based Gluskin Shelf & Associates Inc., says in a recent Globe & Mail commentary, that this is no garden-variety recession, but something resembling a depression.

That being said, the questions I would like to pose to businesses, economists, bankers, academics, the mainstream media, and federal, provincial and state government leaders in both Canada and the US is this:
  1. Why are almost 1.5 million people not working in Canada?
  2. Why are almost 15 million people not working in the US?
  3. And why is the mainstream media not covering this story, and in doing so try to get to the root of questions 1 and 2?
I hope that it's not what I think it might be. That the 1.5 million people and their families do not warrant the media coverage, deeming feel-good stories as more appropriate to their advertisers' sensibilities. Well, it's a crisis to those individuals and their families, is it not?

I know, because I am one of the uncounted unemployed.

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