Written in September 2016, a time when Canadian unemployment was 7% and household debt was climbing steadily. Since then, Canada has seen record housing inflation, pandemic-era job disruptions, and rising interest rates in the 2020s. The concerns about part-time work and debt servicing still resonate. Today’s challenges are on a far greater scale. This makes the 2016 worries look almost quaint in hindsight.
Stats Canada published their Labour Force Survey, August 2016 last Friday. The numbers continue to underwhelm. They might even discourage folks. While employment has increased by 26,000 jobs, the unemployment rate has also risen by 0.1%, now standing at 7.0%.
I always look to see what kind of jobs are being created, and this line from the report is quite telling:
Compared with 12 months earlier, employment increased by 77,000 (+0.4%), with all of the gains in part-time work. Over the same period, the total number of hours worked fell slightly (-0.4%).
So more folks working part-time jobs is not a ringing bit of good news for the current economy. The types of jobs being created is also telling:
There were more people working in public administration, and fewer people working in professional, scientific and technical services.
More admin folks, is that a good thing? I am glad there are more folks over 55 finding jobs. However, us old folks clogging up the market can’t be suitable for the young folk looking for work.
Stats Canada also reported on Household Net Worth this week, and as you might guess there is more debt out there.
The household debt service ratio (seasonally adjusted), measured as total obligated payments of principal and interest as a proportion of disposable income adjusted to include actual interest paid, increased from 14.1% in the first quarter to 14.2% in the second quarter. The interest-only debt service ratio, defined as household mortgage and non-mortgage interest paid as a proportion of disposable income, was 6.3%.
Let the media storm around this data commence!
My Writings for Week Ending September 16th
Seems to be RESP season these days. If you have kids, are there any times when RESP Sometimes Doesn’t Make Sense ? Yes, but only in obvious areas that you can already guess about. It is free money after all.
A Money Thought
Have I mentioned that text books are expensive lately?
Now is the Autumn of our Finances
- The Blunt Bean Counter is a die-hard hockey (and Leaf) fan, and given the World Cup of Hockey is about to start, he went topical with, Steve Stamkos, Olympic Medals and Income Taxes .
- Our friends at Proliteracy ask the question Ontario Student Grant Update. Will you get free tuition? Have a read if you think there is a chance you might.
- Is it possible to apply the laws of physics to the Stock Market? The Canadian Couch Potato hypothesizes with Understanding the Momentum Factor .
- There are a great deal of misguided folk who keep looking at their RRSP balances, and think they have that much money,they don't!, as Tom Drake points out in Withholding Tax on RRSP Withdrawals: What You Need to Know
- TransUnion has put out a report that does some interesting arithmetic (that seems a little flawed), stating, Nearly One Million Canadians May Struggle When Interest Rates Rise, which seems a little bit of an overstatement, but not too far from the truth either.
- Million Dollar journey brings us, A Financial Update from Pete A 50 Year Old Multi-Millionaire, if you are curious how rich folk do things.
- Robb from Boomer and Echo brings us How Much Will My Defined Benefit Pension Pay In Retirement?where he does some good arithmetic, and then some fact checking on how good his retirement might be.
- Mark from My Own Advisor goes a little tongue in cheek with Kick a$ ways to kill your retirement plan
- Michael James weighs into the heated discussion going on about Air Miles, and their new policies, in his piece, Thousand-Foot View of Air Miles. As usual his point about other point systems going the same thing (yes, I mean Aeroplan), is well made.
FAQ
It rose to 7.0%, despite 26,000 new jobs created.
Mostly part-time jobs, while hours worked declined overall.
Gains in public administration; losses in professional, scientific, and technical services.
Debt service ratios increased slightly, with interest payments alone at 6.3% of disposable income.
It highlights ongoing financial stress in Canadian households and the limited quality of job creation.
2016 Random Thoughts
- January 7th, Market Meltdown, TFSA, WildCard Weekend and #MoneyStories
- January 14th, Cheap Oil, Cheap Dollar, Dead Folk, and #MoneyStories
- January 21st, Loose Money, High Household Debt, Weak Loons and #MoneyStories
- January 29th, Doomsday Clocks, Rogue RRSP Receipts, Cash Crops and #MoneyStories
- February 4th Bouncing Loonies, RRSP Season, Superb Owls and #MoneyStories
- February 12th Lent is Here, Bricked iPhones, Love Day and #MoneyStories
- February 19th Digging Out, Ransomware, RRSP Time and #MoneyStories
- February 26th RRSP Time and #MoneyStories
- March 4th Welcome Americans and #MoneyStories
- March 11th Bank Rate Stays Put, Spring Forward and #MoneyStories
- March 18th Financial March Madness, Budgets and #MoneyStories
- March 25th, Easter is Here and some #MoneyStories
- April 1, Money Fools, Ronnie, and #MoneyStories
- April 8, Tax Time, Spring Delayed, Panama Papers and #MoneyStories
- April 15,Loose Money, Free Stuff, Hockey and #MoneyStories
- April 22,Disabilities, Tax Time, The Queen and #MoneyStories
- April 29,Pitter Patter Tax Time, RESPs are For Rich Folk and #MoneyStories
- May 6, Fort Mac, Mothers and #MoneyTalk
- May 13, Panama Papers, Google & PayDay Loans, Full Moons and #MoneyTalk
- May 20, Victoria Day, The People's Elbow, Haircuts and #MoneyTalk
- May 27, Loose Money and #MoneyTalk
- June 3, CRA Itunes Pmts, RESP Scams and #MoneyTalk
- June 10, Portal to Hell Opens in Ottawa, BoC FSR and #MoneyTalk
- June 17, Fathers Day, Trump Housing Bubble, and #MoneyTalk
- June 24, Brexit, Fete National, Enhanced CPP and #MoneyTalk
- July 1, Happy Canada Day and Best Mid-Year Financial Stories
- July 8, Brexit Market Mayhem, Millenial Bashing and #MoneyTalk
- July 15,Brexit Hurts, Loose Money, Postal Strikes, Recounts and #Moneytalks
- July 22,More Pensions, New CTC, and #MoneyTalk
- July 31, Unknown Long Weekend, Windows 10 and #MoneyTalk
- August 5, The Olympics, Topless Spelunkers, and #MoneyTalk
- August 12, Women Rule, Less Jobs and #MoneyTalk
- August 19, Obnoxious 30 Year Old Retirees, Olympics and #MoneyTalk
- August 26 ,Farewell, EpiPens, Ombudsman Report and #MoneyTalk
- September 9, iPhone 7, High Tuition, Loose Money & #MoneyTalk
My Twitter feed is where I re-tweet many great articles by some of my featured writers. I occasionally make odd or off-colour commentary on life.
