By Eastern Workforce Innovation Board* – 2023
But is it enough to survive the anticipated downturn in the economy?
Many economists are predicting an economic downturn in Canada in 2023, with some economists predicting its effects as early as the first quarter.
For the last several months interest rates have been rising and are forecasted to do so throughout 2023. Central banks are in the midst of one of the most aggressive rate-hiking cycles in history.
Housing markets have cooled sharply. And while labour markets remain strong, employment levels have been declining. In addition, The U.S. Federal Reserve hikes projected in early 2023 will hasten the arrival of this downturn in Canada. Growing inflation rates usually signal higher bank rates which manifests a reduction in household consumption and a deeper economic downturn.
There is no doubt that the labour market is the tightest it’s been in decades. An excess of job openings and a scarcity of workers will protect against a major spike in unemployment in the very near-term. However, it is expected that the jobless rate will still rise. A report issued in October 2022 by RBC Economics predict that a weakening in the economy will push the jobless rate close to seven per cent by the end of 2023 — up almost two percentage points from lows of 4.9 per cent in June and July.
Eastern Workforce Innovation Board – The Eastern Workforce Innovation Board (EWIB) is one of 26 boards that comprise Workforce Ontario – Leaders in Workforce Planning. EWIB provides details on community workforce planning and development as well as everything you need to get connected – find the resources in your community relevant to training, employment, labour force information and discover community partnerships.
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