About those tax cuts... CLC President comments on latest job numbers for August 2012
Posted: Friday, 7 September 2012
OTTAWA – The Canadian Labour Congress says it’s time for the federal government to get serious about creating good jobs, abandon the tax-cuts-for-jobs partnership with private corporations that haven’t delivered the goods and invest the money where there’s a better guarantee that jobs for Canadians will be the result.
According to the latest report from Statistics Canada, there were 1,373,000 unemployed Canadians in August with a national unemployment rate of 7.3%. For young workers in the 15 to 24 age group, unemployment rose to 14.8% with barely more than half (52.8%) able to find full-time employment.
Private sector job growth over the previous year stood at a disappointing 1%, outpaced by a public sector growth rate of 1.9%. Older workers saw some improvement in employment since August 2011, but workers aged 25 to 54 experienced a tiny 0.4% growth in jobs. For those 24 and younger, the outlook remains bleak – they lost another 22,000 jobs last month, bringing the total for the previous 12 months to -72,000.
“In return for tax breaks, companies are supposed to invest to create jobs, but they are not keeping their end of the bargain. Instead, they are hoarding cash and paying out fat dividends to their shareholders. It’s not fair to the million-plus Canadians who can’t find work to let this continue,” said Ken Georgetti.
Georgetti noted that, according to the Department of Finance, $1 billion of infrastructure investment creates more than five times as many jobs as the same amount spent on corporate tax cuts.
Earlier this year, the CLC released a report that showed $30.7 billion in short and long term cash assets had been hoarded over the previous decade by just ten Canadian companies. With the report, the CLC also released public opinion research on the issue of corporate tax cuts which found solid support (92%) among Canadians to force corporations that don’t use their tax breaks to create jobs to return the money.
This summer, the Governor of the Bank of Canada broke his silence about the problem of corporate money-hoarding and the failure of Canadian businesses to invest in the economy. Georgetti hopes the federal government was paying attention and takes the appropriate actions to end tax-cuts that reward this counterproductive behaviour.
Quick Analysis from CLC Senior Economist Angella MacEwen
The jobs recovery for workers 25-54 continues to disappoint. Only 47,000 jobs were added for this age group in the past year, a growth rate of 0.4%. Youth employment prospects continue to decline, with 72,000 fewer youth employed compared to last August. The real unemployment rate (R8), considering involuntary part-time and discouraged workers, has risen nearly 1 full percentage point for men and women aged 15-24 since last August, to 19.2%. The employment rate for students aged 15-24 was 47.9% this summer, worse than the summer of 2009 (48.6%), when students were hard hit by the recession.
The Canadian Labour Congress, the national voice of the labour movement, represents 3.3 million Canadian workers. The CLC brings together Canada's national and international unions along with the provincial and territorial federations of labour and 130 district labour councils. Website: www.canadianlabour.ca. Follow us on Twitter: @CanadianLabour
Contacts: Angella MacEwen, CLC Senior Economist, 613-526-7412
Jeff Atkinson, CLC Communications: 613-863-1413 Email: firstname.lastname@example.org