Canada column for Sunday, May 24/15
THE CANADIAN REPORT
(c) By Jim Fox
More doom and gloom predictions for Canada’s “oil patch” suggest there could be up to 185,000 job losses this year.
A report by Enform’s labor market division said the potential losses would amount to a 25-percent drop in the number of jobs due to budget cuts in the oil and gas industry.
Hardest hit would be resource-rich Alberta where the oil-price collapse darkens the economic fortunes in Calgary and Edmonton.
The Conference Board of Canada forecasts the two biggest cities will fall into recession this year.
“The energy sectors in both cities will decline, but other sectors will also feel the pinch from lower oil prices including construction, transportation, warehousing and wholesale and retail trade,” the board said.
It predicted that benchmark West Texas Intermediate crude oil will average $56 U.S. a barrel this year and $69 in 2016 – down from $102 a year ago.
Enform’s report said the industry is expected to spend $94 billion this year, down from $125 billion last year.
The study said engineering construction firms are most vulnerable followed by exploration and development drilling.
Canada’s annual inflation rate decelerated to 0.8 percent last month largely due to lower energy prices compared with a year ago, Statistics Canada said.
It was the lowest since October 2013 and was down from 1.2 percent in March.
There were higher prices for meat, up 11.2 percent, home and mortgage insurance were up by 8.6 percent, and phone service prices were higher by 6.3 percent.
Consumer prices rose in seven provinces while Newfoundland and Labrador, Prince Edward Island and New Brunswick had negative inflation.
The lower figure isn’t expected to result in any change to Canada central bank interest rate when it’s reviewed on Wednesday.
News in brief:
- Luggage bin hogs are going to be targeted by Air Canada staff beginning on Monday. The crackdown begins at Toronto’s Pearson International Airport where carry-on bags will be checked to be sure they meet size and weight requirements. Oversize bags will then have to be checked as baggage. The airline says the program will expand to other airports across the country through June.
- Tim Hortons, Canada’s iconic coffee-and-doughnut shop chain, has closed its U.S. headquarters in Columbus, Ohio. It will handle operations from its Canadian command post in Oakville, Ontario. Since it was taken over last December by3G Capital, a Brazilian investment firm that merged the operations with Burger King, there have been about 350 job losses at Hortons in Canada.
Facts and figures:
The Canadian dollar is lower at 81.21 cents U.S. while the U.S. dollar returns $1.2313 in Canadian funds, before bank exchange fees.
The Bank of Canada’s key interest rate is steady at 0.75 percent while the prime-lending rate is 2.85 percent.
Markets are higher, with the Toronto Stock Exchange index at 15,196 points and the TSX Venture index 701 points.
The average price of gasoline across Canada is higher at an average of $1.1341 a liter or $4.309 (Canadian) for a U.S. gallon.
Lotto 6/49: (May 20) 2, 4, 12, 17, 18 and 47; bonus 14. (May 16) 1, 12, 22, 25, 35 and 45; bonus 9. Lotto Max: (May 15) 16, 23, 24, 25, 40, 46 and 47; bonus 17.
- A parent’s tip led police to apprehend 10 teenagers allegedly trying to leave Montreal to join jihadists fighting in Turkey and Syria. Nine were arrested at Pierre Elliott Trudeau International Airport and another in Saint-Leonard. Police said some have ties to the six Quebecers who are thought to have left for Turkey, en route to Syria, in January.
- Vancouver transit users got free rides on Friday from TransLink after a SkyTrain fire shut down service and caused massive delays for thousands of riders. Sparks from grinders used by a maintenance crew set fire to an unnoticed bird’s nest under the tracks. The blaze damaged a large section of cable that controls the train.
Jim Fox can be reached at email@example.com