Photo: Olivier Douliery Agence France-Presse
The Fed has reiterated that the 20 million jobs lost in less than two months erased the gains accumulated during the last decade.
The impact of the pandemic shakes all levels and in all sectors not deemed essential to the economy. However, it is more felt in low-income and vulnerable workers. You can understand these central banks are urging governments not to skimp on using tax direct.
A study published on Wednesday by Payments Canada on the effects of the health crisis, indicates that 75 % of Canadians say they spend less than before the crisis. Not surprising in a context of teleworking, if it is not that the survey conducted by Leger among 1504 Canadian adults between 17 and 19 April, states that 44 % of respondents complained of a decrease in their income, and that 51 % have declared that the pandemic had a negative effect on their retirement savings and other investments. In addition, 26 % said they find it difficult to pay their bills before the due date.
Also on Wednesday, and despite the explosion of the u.s. budget deficit that is heading towards a tripling this year, the boss of the federal Reserve, called on elected officials to do more, no matter what the cost, to avoid a long recession whose effects would be felt more in the segment of the population more vulnerable. “Support additional budget could be costly, but it is worth the effort if it helps avoid economic damages in the long term and allows us to have a more robust recovery,” said Jerome Powell.
The Fed chairman reiterated that the 20 million jobs lost in less than two months into this pandemic erase the gains in terms of jobs accumulated in the last decade. He added that these are the households with the lowest income who suffer the most : among the people who had a job in February, ” nearly 40 % of those households earning less than $ 40,000 per year have lost their jobs in march “.
The dashboard on the evolution of the coronavirus in Quebec, in Canada and in the world
While acknowledging that the double intervention current monetary and fiscal is the correct one, he insisted that ” elected officials should not look at this time of the expenditure “, one reads in the text of Agence France-Presse.
Canada is no exception. The jobs most affected by the health crisis, come from the sectors of accommodation and catering, wholesale and retail, culture and leisure. According to Statistics Canada data from April, some three million jobs have been lost in two months. Add to the equation 1.1 million people able to work but have ceased to look for one in April.
The data of April, the federal agency indicate that more than one-third of the working population is not working or has suffered a reduction of hours of work. The most affected have been the vulnerable workers employed part-time or temporary. By size, small enterprises had laid off 31 % of their workers, medium-sized, and 25% large, 13 % of their employees, could be read in The line of Duty.
As to the war effort deployed, Oxford Economics was Wednesday, using current tax Ottawa 326 billion, or 155 billion in the form of direct assistance, $ 85 billion in deferred tax and 86 billion in loans and emergency loans. Side money, the Bank of Canada has doubled its balance sheet in a year of quantitative easing, including the purchase of us $ 200 billion of securities between mid-march and mid-April. In its interventions, it also delivers a lot to the Treasury bills, qualified shock of crisis and tension. The analysts of the National Bank have calculated that the increased supply has put the “stock” of canadian Treasury bills of $ 127 billion at the end of February to a little under $ 300 billion last week.
Which is not without recalling the role of central banks in the financing of huge deficits created in the 1940s to support the war effort, have shown.
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