Economics Newsletter – Week of October 4th 2020

Written By: Amit Shteyer & Hannah Lobbezoo

Canada’s Economy at a Glance

Economics Society News, Events, and Articles


The Pandemic’s Sleeping Giant: The Vaccine by Hannah Li Saul

Join our virtual ECON lounge on Discord!
Keep an eye out for information on the UW Grad School Info Session, happening on October 23rd

News and Noteworthy

Bank of Canada keeps door open to possibility of negative rates:
Previously the Bank of Canada de-emphasized the possibility of using negative interest rates. However, now the Bank of Canada Governor, Tiff Macklem, has put the concept back on the table as an option to mitigate downside risks should they intensify. Read more.

Canada added 378,000 jobs in September, even more than in August:
March and April saw three million jobs lost and between June to August we’ve seen numbers begin to bounce back at decreasing returns to scale. This is why economists were surprised when hiring began to pick up again in September and Canada regained three-quarters of its jobs lost. Read More.

Ontario, Alberta face a growing split as economic interests diverge over fossil fuels:
A recent analysis found that fossil fuel projects that suit Alberta’s interests, may not be so good for the finance industry in Ontario. The success of the financial and industrial sectors in the province depend on a transition to low-carbon. Read more.

Path to recovery littered with debt risks, Bank of Canada governor warns:
The actions that have been taken by policy-makers to soften the blow of the COVID-19 induced recession will cause Canada to be much more vulnerable than it was before. Corporations and the government are collecting large amounts of debt that expose their weaknesses to future shocks. Read more.

Slowing job gains to affect low-income earners most:
Low-income workers have been disproportionately affected by the recession and employment recovery. Hours worked by those who earn less than $16 dollars an hour are still 20% lower than their pre-recession level, while those that earn over $40 dollars an hour are actually higher since the pandemic began. Read More.

Targeted aid coming for some businesses hit by COVID-19 closures:
The federal government released plans of targeted aid for businesses that are not able to operate at full capacity, or not operate at all due to COVID-19. The over-hauled rent relief program was also released, allowing businesses to directly apply for relief through the Canada Revenue Agency. Read More.

Recommended Read

Narrative Economics by
Robert J. Shiller

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