3. Deficit - Paul Martin, Stephen Harper
and Justin Trudeau Comments:
• Global Recession from 2008-2009
• Fort McMurray fire 2016
• Slow Economic growth since 2000 (2.0% or less)
• Martin and Harper cut personal tax rates
• Harper reduced GST from 7% to 5%
• Harper reduced corporate taxes to 15%
• Justin Trudeau reduced taxes to middle class
and hike taxes to wealthiest
• Justin Trudeau new family tax benefit is only
$7/month more than the CPC plan
• Justin Trudeau is forcing a carbon tax on all
provinces
Source – Stats Canada and
https://knoema.com
4. Wages / Canada
• What is Stagnation?
• Stagnation is a prolonged period of little or
no growth with wages
• What determine salary increases
• Rating systems
• Union contracts
• Market value
Comments:
• Middleclass us under pressure around the
world
• UK, Canada and USA have had similar
economic growth
• Wages tend to be tied to economic growth
Source: Investopedia, Stats Canada and CNN
5. Employment / Canada
Source – Stats Canada and CIBC
Comment:
• There has been shift for close to
four decades from full-time to part-
time jobs (Job quality)
• Goods producing sector struggling
due to low commodity prices
• Canada needs to better align
education/skills with job opening
• New carbon taxation and/or hikes
to CPP will no create jobs, but could
impact both wages and jobs
• Canada needs to reduced the red
tape to get projects off the ground.
Canada depends on FDI
• Canada needs to continue to sign
fair and equitable FIPA and Trade
Deals
6. GDP Growth
Source: Scotiabank, Cheatsheet.com,
Investopedia and Stats Canada
What does GDP Growth mean?
The gross domestic product (GDP) is one of the
primary indicators used to gauge the health of a
country's economy. It represents the total dollar value
of all goods and services produced over a specific
time period; you can think of it as the size of the
economy.
How Do Millennials spend money:
• Millennials spent an average of $26,000 a year on
discretionary purchases, such as eating out and travel.
This is $6,000 less per year than the average consumer.
• Millennials tend to use cash, a debit card and checks for
half of their monthly spending and charge just 30% of
their purchases.
• Millennials love their coffee. The only category where
millennials spent more money than Generation X and
baby boomers is on coffee and fast food.
7. GDP by Expenditure
Source: Stats Canada and http://www.environicsanalytics.ca/
• Part-time jobs do not have benefits
• Most millennials are doing jobs not necessarily
related to their field of studies
• Many millennials still live at home due to
housing costs and student debt
• Household spending drives the economy
8. Housing
Source – Scotiabank, BMO, CMHC and RBC
Comments:
• You need earn
over 100K+ to be
able to afford a
home
• Condos can be
cheaper, but
come with costs,
i.e. maintenance
fees
• Apartment rent
can vary from
$850 to $1,200 a
month
9. Graduates
Commentary:
• Canada is producing 500K to 516K grads per year
as compare to the job market which is only
creating 200K in new jobs
• Declining enrolment is impacting education
• Healthcare cutbacks are forcing the elimination
of healthcare jobs
• Canada is export driven economy. Exports need
to expand to new markets. For each $1B in
exports is 5,500 jobs
• Retail Channel is evolving to more eCommerce.
• There is a skills gap. Education has not align to
jobs in areas like advance manufacturing,
Cybersecurity, Analytics, Expert Farming, etc
•
10. Debt/Deficits on the
millennials
Comment:
• Approximately 1/3 of income is
taxes
• Today’s debt and deficits are
tomorrow taxes
• Government is imposing CPP
hikes which will reduced your after
tax income.
• Carbon Taxation will impact
millennials as they eat out and
travel more as part of their
spending
• Largest growing segment as such
will be impacted more by taxation
increases and/or spending cuts
• Many companies as well as
government are moving away from
defined benefit pensions to
defined contribution – FYI no
guarantee pension benefit will be
the new norm.
11. Summary
• It is not one policy that drives business investment, but many policies
• Federal policy changes can be counter productive if either provinces or
municipalities increase hydro rates, personal taxation, user fees, property taxation
• Canada competes for business investment and needs to be competitive with other
jurisdiction areas like taxation, hydro rates, reduction of red tape, labor rates,
productivity, R&D tax credits
• Canada needs to eliminate interprovincial trade barriers
• Canada needs to new equalization, CST, HST and other transfer deals with the
provinces and Territories
• Globalization not going away. Canada needs to respond better to globalization